Mid-week market update: You can tell a lot about the short-term character of a market by the way it reacts to news. When the news of Gary Cohn’s resignation hit the tape after the close on Tuesday, ES futures cratered down over -1%. By the market closed Wednesday, SPX had traced out a bullish reversal after an early morning selloff and closed flat on the day.
Is that all the bears can do?
Signs of washout
The signs of a sentiment washout are showing up everywhere. The TD-Ameritrade Investor Movement Index (IMX) retreated dramatically in February to levels seen last spring, indicating retail investor capitulation.
In addition, Schaeffer’s Research found that the first time since the 4-week moving average of new highs/lows fall below 1.0 tends to be bullish.
Though the sampleRead More »