Well much of what I thought about blogging today Cramer covered in the previous video. Ha. Today was a bad day for news flow though you wouldn't know it by looking at markets world wide. It was risk on. Everything was up. You had poor European economic data and the U.S. data stunk it up as well. Fresh signs of potential stress in Spain but Spain rallied with everything else.
Today was also gruesome because again yesterday you had a head fake with the sell off into the close with the market just getting slapped down from the 200 day moving average. Just like last week a usual decent signal ended up being completely false as today not only did we rally but closed above technical resistance I am sure hurting bears taking yesterday as weakness. I am halfway expecting at least for tomorrow a similar thing to happen for the bulls. Would not be surprised to see a slap down tomorrow catching all the bulls off guard after breaking resistance today. The markets should be heavy with BP bad news flow again going into the open. Tonight the estimated barrels per day being released into the gulf was upped, apparently some banks are starting to pull in trading lines, and Obama was blasting the airwaves tonight. You have a bunch of economic data coming out before the market opens tomorrow also but as you saw today the market is going to trade in whatever direction it wants regardless of the data.
If we close back below the technical resistance tomorrow(200 day moving average and below 1110) I put it at 50/50 that the rally is done. The other 50/50 is that we will go to that 1140 area I have talked about numerous times. Even if we get slammed tomorrow I would be very hesitant to short unless the news flow is equally bad out of Europe. It can't be just about BP. Another interesting thing to watch tomorrow if the markets are down will be the volume. The NYSE volume was abysmal today and has been getting progressively worse as the rally has rolled on. The ES futures volume was decent which means almost the entire move today was driven by futures. The slowing volume on the NYSE is also a warning signal.
The economy is on life support, the market is on life support, and danger signs are flashing but in the interim it still seems like this market could grind higher.