I wrote a piece around 8:30 AM late last week about the potential for a gap down open creating emotion; at the time the major indexes were down by about 0.7%. Of course in the ensuing 30-40 minutes "they" bought 'em, taking the indexes up by about half a percent which offset the chance for a potential washout morning. Today, I waited 40 minutes later to see if that would happen again before writing a post – instead it seems losses are holding as the S&P 500 looks to open near the low end of the range from last week. There has been a strange lack of emotion during this selloff which is now almost a full two months old. That is actually quite a long correction in terms of duration but the magnitude has not been supreme at least for the S&P 500 (the NASDAQ is going to be at a roughly 10% correction this morning at the open). Definitely a drip drip drip type of selloff rather than shock and awe. What many would like to see for a tradeable bounce is a big down open, emotional in nature, followed by a turnaround late in the day – but with so many mornings the past few months being flat to up that condition rarely has a chance to play out. We'll see if we get closer to that emotion in the market today.
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