Once again, stocks gapped hard to the downside on Tuesday morning. The same old story, fear about the stability of the US banking system.  Will it fail?  It is the question being asked across Wall Street and Main Street.  As stocks appeared to be headed toward being down more than 2% buyers stepped in and started to rapidly buy stocks.  It was an impressive rally to come off the lows however, it coincided nicely with Christopher Cox’s testimony that he would start aggressively pursuing “Naked” Short Sellers (shorting stocks without first borrowing the stock from a borker).  Needless to say, it appeared the intraday false rally was more linked to shorts covering than anything else.  Regardless, price action continues to be to the downside.  Volume exploded higher, right from the gate the run rate was tracking much higher all day long.  This market remains very sick for bulls and staying on the sidelines is a very wise move.

Market Speculator

Last 5 posts by Market Speculator

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