That report in the FT late Tuesday has done wonders. The S&P 500 was sitting at 1080, and then we had that 45 minute explosion to close out the day. Other than a little hit first thing yesterday morning, and first thing today (a massive reversal at 10 AM) we’ve been straight up. To the tune of around 80 S&P points… that’s a >7% move in just over a day and a half of market time. The volatility continues to mark an unhealthy market, but as always unhealthy feels better when its to the upside rather than the downside.
The 50 day moving average has been a very good tag as resistance since late August, so we’ll see if that happens again. It has a very steep downward slope now, so has dropped below 1190, from the mid 1210s a few weeks back. Bulls would like to see this level cracked, to begin to get more constructive.
That level is about 2.6% higher from here, and if for example it was hit tomorrow it would be a full 10% move since about 3 PM Tuesday. Wicked volatility.
Remember we have the monthly employment data tomorrow, which might skew upward due to the 45K Verizon workers returning from strike – but to keep this sort of hectic momentum going we’re most likely going to need a nice upside surprise.