Now That’s What I Call A Volatile Market!

I feel for anyone that bought into that fake rally today.  Having watched the futures spike right before the open it was looking like a very positive day, but alas, that positivity did not last long.  The range of the day in the S&P 500 alone was close to a 50 point swing between high and low.  It is very rare to see such a huge move.

My indicators are still saying it’s too dangerous to be in the market, so I am still patiently waiting in cash, and even though I expect to see a recovery of some sort tomorrow given that we have had 3 days of heavy selling, I will wait for less choppy waters before I expect to put capital to work.

Market News:

U.S. stocks fell on Tuesday, after a near 300-point rally on the Dow evaporated amid falling commodity prices and worries Germany would throw cold water on the European Central Bank taking additional steps to bolster the region’s economy.

Reports from overseas that had Germany downplaying the notion of further quantitative easing by the ECB helped push the market lower, Art Hogan, chief market strategist at Wunderlich Securities, said.

With the fourth-quarter earnings season started, investors are on the lookout for the the effect of crude’s decline on the S&P 500’s collective bottom line, with oil prices on Tuesday falling to near six-year lows as a major OPEC producer stuck to the cartel’s decision not to reduce output.

Alcoa’s initial gains evaporated, with the aluminum producer turning lower after reporting better-than-expected results late Monday.

Scaling back from a 282-point jump, the Dow Jones Industrial Average fell as much as 142 points, before ending at 17,613.68, off 27.16 points, or 0.2 percent.

The S&P 500 shed 5.23 points, or 0.3 percent, to 2,023.03, with materials and energy hardest hit and utilities and telecommunications faring best among its 10 major sectors.

The CBOE Volatility Index, a measure of investor uncertainty, rose 3.2 percent to 20.23.

The Nasdaq declined 3.21 points, or 0.1 percent, to 4,661.50.

Wednesday:

Earnings before the bell: JPMorgan Chase, Wells Fargo

8:30 a.m. Eastern: Retail sales for December

8:30 a.m.: Import prices

10 a.m.: Business inventories for November

2 p.m.: Beige Book

News Sources:  CNN Money & CNBC