After four consecutive weeks of gains, we needed this pullback, after all what are we rallying about anyway. We rallied on the Bear Stearns bailout, but now we see that financials are pulling back, and oil prices are at their highest as inflation rears its ugly head.
The VXN (Nasdaq Volatility Index) is higher by 9% on the week at 23.53. The "fear gauges" retested their 2008 lows mid-week but have since modestly rebounded with the major indices trading lower over the past two days to end the week in negative territory (SPX currently -1.9% on the week, Dow -2.5% and Nasdaq -1.5%).
A low volume, narrow range session as we continue to notch lower lows. Support is about 30 points away from Friday's close, so I expect we'll bounce early this week.
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