Yesterday's Rally: More Upside Volume than Monday's Sell-off

The Banks and the leaders in tech were on fire yesterday (Tuesday Feb. 24), but of the big four, Apple (AAPL) sported the weakest advance. Does that have any real significance in the big picture, probably not. It is worth noting however, that AAPL did recapture that critical 90 level, but failed to recapture its 20/50 day moving averages.

The markets made a good comeback as well, but the S&P couldn’t recapture the 775 level. Will it get there today?

There’s some hope in that the market internals were good, with advancers outpacing decliners by 3 to 1 on the Nasdaq, compared to Monday where the decliners beat advancers 4 to 1. But the key yesterday was that the up volume was much greater than with Monday’s down volume. That means more buyers yesterday than sellers Sunday.

The VIX was the big surprise of the day, it fell like a rock. Is that a bullish indicator, or something else? Well, I learned quite a bit from the tweet above from, posted by @coffeygrinds, a.k.a. Andrew Coffey, that points to a video of GroupOne’s Jamie Tyrrell who explains that the market thinks volatility is here to remain, and that these downside put premiums are too expensive. So there was a Put Smackdown. To watch the video, click on the Tweet above, then click on the Blip.tv link in the tweet.

So, if traders think that volatility is here to stay, what does that say for the near-term? I guess that will largely depend on how the markets react to president Obama’s speech last night. After viewing the speech, I have to say that there was nothing in it that will get Wall Street overly excited.

Comments

[Zach Bass:]

Wow! Two articles in a row with no comments, that's a change! Where's all the Zach Bass-hers?

Does no one care about the state of the economy?

Feb 25 12:52 PM

[Dave Wrixon:]

Well, all I would say is that moving averages mean nothing to general trend, until the market knows what is happening to earnings. If earning hold or recover, then stock value will do the same. If earnings meltdown then we are headed a lot lower than this. I don't think your charts can really answer that one can they? Until, the dust settles what you are going to get is volatility.

Feb 25 01:59 PM

[Tony Petroski:]

Mr. Bass. I thought I would make a comment to make you feel better. If you want comments, write an article like: "Gold: An Investment for the Foolish?"

Feb 25 05:06 PM

[Jon T:]

You're too sensible and uncontroversial to warrant comments.

You need to prod, provoke, and pooh pooh.

Feb 26 09:14 AM

[mollytjm:]

your comments are more directed to day traders...very short term investors. i'm not one of them. i'm a long term value investor, so that's why i don't comment...i figure my comments won't mean much to people who follow you.

Feb 27 02:59 PM