On Thursday the SPX closed at 3768.47 or -1.34% on moderately negative internals and everything but the energy sector was red. The NDX is now below its 100-day moving average, while the RUT and DJIA both broke through but eventually settled on their 50 day moving averages.
NYSE A-D lines fell from neutral to around -2000 and closed at -1837 while NYSE breadth closed at -2.27:1 and NASD breadth at -5:1. They were never severely depressed because we bounced around for much of the session and came off the lows of the day quickly.
The ES futures gap of from 1 Feb 3777 to 3799 has been filled, but we dropped below that quite fast before recovering to close at 3772.25. I don't know how Asia and Europe are going to react to this but there is the possibility of a retrace to the rth lows in ES futures between now and Friday US cash open. The market held the 3770 level (point of control from 1 February), but because overnight futures are lightly traded and influenced by overseas markets, many traders will be hypervigilant now. We also have an NFP employment report tomorrow at 08:30 US ET and, given the treasury market issues, we could see more short-term crazy. As for implied volatility, the VIX made a high of 31.90 but closed at 28.57 or +7.12% on the day. The weekly hedging situation has not changed much but the market is throwing tantrums because of Fed phrasing -- we can't get what we want when we want it. That means bystanders are in caution mode until things get a bit more ironed out.
