Tuesday, June 16, 2009

Market summary of June 16, 2009

The market closed down today reaffirming the trend reversal signaled last week. The Dow closed down 107 points to 8,505, while the Nasdaq closed down below 1,800 to 1,796. The S&P 500 closed down 12 points to close at 912 for the day. Market volatility, as measured by the VIX Index, closed at 32.68, which is at the highest level since May 26th.

An interesting piece of data today is the Put to Call ratio. It reached a closing high today of 1.01 and this level has not been reached since the lows of the market on March 30th, when the Put to Call ratio reached 1.14 on that close.

We are still only 2 days into Options Expiration week and the volatility will continue to rise, but it is difficult to say whether the market will continue to sell off the rest of the week. We have not yet gained momentum enough to drop more significantly.

The volume traded today was about equal to yesterday, however, it is below the trend line moving average. With light volume this market could keep drifting lower. Shares of TZA closed at $23.80 after reaching a high of 24.01 during the day. The last 2 days of TZA had higher volume than the previous day. What tomorrow brings should be down again, but I am learning to respect the market has a mind and will of its own.

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