The markets were finally able to generate the bounce that everyone was waiting for, but on relatively low volume, however. Most of the move took place overnight on the release of China’s economic data. Apple had a nice move, up 1.79 percent, but also on low volume.
In fact, the table below shows that in 2011 Apple has had 10 daily moves greater than 1.75 percent with an average volume on those moves of 17.5 million shares. Today’s move was on the lowest volume for a 1.75 percent or greater move in the three calendar years we analyzed. Similarly, the S&P500 ETF (SPY) was up 1.27 percent on about 60 percent of volume of big day moves in 2010.
Nevertheless, it’s a start and the shorts, who really never had a chance to cover today, are licking their wounds. We now need to see some follow through with decent volume to bust out of the short-term downtrend. We’re not so sure this is a risk-on moment, but remain flexible. A clear high volume test and bounce off the 200-day moving averages will give us more confidence. Stay tuned.
(click here if table is not observable)
Global Macro Monitor 