After heavy volume selling on Tuesday buyers stepped back up today pushing the market off its lows from Tuesday. Volume dropped on the session as NYSE volume dropped 13% and the NASDAQ 16%. It really is no surprise to see volume drop on a rebound especially in this market environment. From last November lows till now we have seen this market lift on virtually no volume. Volume this month is tracking to be near decade lows. Just after 2pm the market began to sell off even after a nice rally from the morning lows. Hitting the session lows just before the final hour the market snapped back to session highs before being hit again back down to the lows. This type of action is certainly indicative of a low volume environment. We may see this bounce continue, but it needs plenty of work to regain a new uptrend.
Due to travel tonight’s commentary is going to be light. However, I would like to point out the continued weakness we are seeing in Homebuilding stocks. Pending home sales were worse than expected today and it isn’t a big surprise. Rising rates will, in the short-term put pressure on housing prices and buyers’ willingness to make the leap. The group’s price action continues to point for the entire group to continue lower.
News regarding Syria will likely distract many from the trend developing right now. Do not be distracted and stay laser focused.
Stick to your discipline and always cut your losses. In the meantime, we only have a few days left before summer unofficially ends. Go get ‘em.
