The last five trading days in the market have produced the second largest sell-off we have seen in the market since the July low point, using the S&P 500 and the Dow as main barometers.
2006 has brought about some key technical signs of important changes occurring in the financial markets, to a certain extent, much like 2000 and 2002 were the pivotal years of the fairly recent past.
While the overall weakness of the US equity markets this summer has been a source of much concern for long-term investors, short-term traders however are relishing in the abundance of volatility that has entered the markets during this time.
The bounce off of this year's low point in early June has produced two of the largest up-days the market has seen in several months. Fernando Gonzalez views this as the beginning of a corrective period that is an opposite response to the strong wave of selling that hit the markets in May.
After yet another round of selling to new lows of the year, the market has come back with a rebound that produced the largest single "up" day last Thursday, which was probably more out of reflex reaction to some basic technicals than anything else.
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