The market staged a late day short covering rally and finished the day slightly in the green. Investors are fearing the old Sunday evening government intervention so no one wanted to go into the weekend overweight on the short side. The Nasdaq finished lower, gold moved marginally higher, the dollar retreated 0.75%, oil surged 5% and bonds lost 0.6%. For the week the S&P finished lower by 6.8% and is now down by 23.5% for the year. Amazing numbers.
Sentiment is absolutely horrible. If Ben Bernanke farts on Sunday the market might move up 3% overnight. Next week is very very light on the news front. Earnings slow to a trickle, Bernanke testifies on Tuesday and retail sales are out Thursday. Slow economic news weeks generally leave the door open for corporate news to dominate and in this environment that is a guarantee of bad news to come. I remain on the fence here after being bearish since the year began. I think being short is very dangerous here after such a steep decline, but being long is equally risky as many issues still confront this market and there is still a complete lack of panic that tends to be seen at market lows. Stay tuned.