The opinions expressed below are my own and do not necessarily represent those of Visdom Investment Group, LLC.
Bad morning
Bulls were running in the premarket with S&P futures trading +39 points as the market opened. Regular hours trading was kinder to the bears however and the S&P fell consistently over the first hour of the day. The S&P spend the bulk of the day down small. Treasury yields did little and headlines weren’t particularly material either.
It appears that the weekend was quiet enough to inspire the bulls but the usual morning dip-buyers were overwhelmed. Bitcoin may be part of the story again. Bitcoin too was up modestly before the equity market opened but it fell significantly around 10 minutes into regular trading hours. The coin dropped for 3 straight hours and found some support down about 3% on the day. Looking at the intraday plots, the drop in Bitcoin and the drop in the S&P were essentially simultaneous. This is different than the last couple weeks where large Bitcoin drops spilled over to stocks.
Right now markets appear to be a little bit skittish. There are no actual events precipitating these mini-worries so the price action is very minor. The question is whether we’re experiencing tremors ahead of something terrible.
Probably, this is all just worry for the sake of worrying but you never can tell. I think the pressure point of US stocks remains Bitcoin, even though the lead/lag relationship is not clear.
See you tomorrow.
-Mike
Visdom Market Commentary
https://visdomig.com/blogs
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