The Post-Greenspan Blues
The equity index complex did not take long this morning to issue its vote against Mr. Greenspan’s discussion, or lack thereof, of a between-meeting rate cut.
Sellers were abundant in the SPH on the open and we quickly pierced the critical 1315 level, which was last week’s low. The bears continued feasting as the market traded as low as 1308.50 before stabilizing. As it stands we are down over 1% on the session.
The interesting story seems to be happening in the NDH, which held above contract lows made the first week of the new year. To me, this potentially sets up a massive short-covering rally. If we get above 2260, all should be good to the upside for the NDH.
As for the SPH, we need to get above 1315 before the buyers will feel more comfortable. If this happens after lunch, it is more bullish. If it happens over lunch, I think the market could go either way and close below the current lows or around yesterday’s settle.