01 October 2008
Bouncing Around the Room
Phish - Bouncing Around the Room
Yesterday's bounce back, the third-highest Dow point gain on record, continued to put market uncertainty front and center.
The VIX tells the story. First, a chart looking back at 20 years of VIX data, care of Maoxian, via Trader Mike:
The number of S&P 500 stocks trading above their 50-day moving average jumped from 48 to 83. While that is still a very low figure, it's off its extreme lows:
The number of Dow components trading above their 50-day moving average likewise jumped from one to eight:
Congressional action (or inaction) is still the main concern. If Congress fails to make progress quickly, the extreme readings will return, and the indices will continue bouncing like Phish on trampolines.