Thursday, March 15, 2007

-120 to +50

Rude shock that I got today.

I monitored Dow yesterday night and was quite happy to see it drop to a low of -120. But before I know it, it opens at +50. As a result, market worldwide experienced a sort of rebound after yesterday's big selloff.

However, today's rebound is quite low in volume. If it goes up with low volume, it's an indication that a reversal is in sight. If it goes down, it doesn't have to be low volume, remember that! Dow's close tonight will be crucial to see how market will react. PPI figure for US is 1.3% higher than forecasted, so that's bad news.

It doesn't seem to go down though. As of now, Dow is at 22 points.

Today is called the witching day also. That's where the futures and options contract expiry. Characteristic of witching day in US is that of high volatility. Inflation figure is high also, so US fed rate might not be cut as soon as investors think.

All in all, bad sentiments. Let's see how Dow performs.