Daily action was relatively mundane considering the news backdrop. The NASDAQ actually made a new high in the process yesterday, while clearly to us ‘if’ Oil kicks-in then the bearish algo crowd and others would have to deal a bit longer with additional rebound efforts.
There’s no doubt that short-interest diminished by virtue of last week’s kick to the upside and shorts that went for the ‘algo’ sale after a Goldman story about sluggish prospects for stock ‘buybacks’, were run-in thereafter. Thus yes there’s an argument for decline but the market absorbed sloppy news, circumstantial or otherwise, and that suggests an intraweek rally prospect.
Yes the market’s at high levels; yes the next rebound can fail; yes the stock market has been under some distribution for a few weeks (as we’ve noted in particular reference to ‘high wealth’ individuals selling on-balance while the institutions were still buying ETF’s). This remains an evolving process.
The market should also be running-out of patience with Washington’s rather persistent infighting, which probably is what distruptors and rejectionists do seemingly want. However, when it comes to ‘collusion’ with the Russians of course let the chips fall where they may; although if those chips reveal that the ‘collusion’ was for the purpose of resetting relations, then questions will develop whether probes are to deter rapprochement rather than the obvious desire to deflect corruption, bribery, or any such other matters.
For now, perhaps a bit of a Tuesday turnaround, which will likely be sloppy, and efforts to take stocks higher impeded by rising skepticism as abounds.
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