Oil fell $3 on reports of a drop in demand and s stronger dollar. The dollar rose the most in two years. A survey of economists now thinks the US will have a protracted slowdown rather than a recession. The trade gap widened to $60.9 billion, largely thanks to oil. And the Shanghai market dropped over 7%.
Considering all of the action as of late, let's step back and look at the numbers from afar -- that is from the 5-day perspective to see where we stand.
The big news here is the huge drop on Friday and Monday. Notice that prices dropped really heavily on those two days. But also notice that prices leveled out today, making today a consolidation day. In other words, today the market took a deep breath to figure out where it wants to move next.
Note the same action with the QQQQs -- they had a really big drop but then rose a touch today in a consolidating move.
Note the IWMs are very similar to the SPYs.
After the hard and heavy action of the last few days, a drop in the intensity helps to calm everybody's nerves.