Daily Market Update – April 12, 2016 (Close)
You probably shouldn’t even try to explain yesterday and even though there was an explanation for today, I’ll believe it when I see it.
As far as yesterday goes, there’s usually a reason for a gap move higher or lower, but yesterday’s higher open didn’t really have too much behind it.
So it may have been a little understandable why the move higher couldn’t be sustained.
But then came the rebound that restored much of what was lost.
That may have been hard to explain, as well.
That rebound didn’t get quite as high as the original gap move, so maybe some technicians may have soured at that point.
Maybe that explains the final leg lower to end the day seeing the market take a small loss.
This morning the futures were headed mildly higher as we awaited tomorrow’s big first earnings test.
That test is the beginning of financial season. Alcoa doesn’t really count anymore. Now it’s JP Morgan Chase that sets the season off to the races and expectations are really low.
I didn’t expect too much action yesterday, but it was an active day, just not for me.
It was safer just sitting and watching, while looking for any opportunity to manage existing positions.
I thought today would be more of the same.
What happened, was what has been just about the only reliable catalyst for all of 2016 kicking in.
It was another large move higher by oil and the market followed, never really considering giving the gain a second thought.
What made me give it a second thought, while I did enjoyed seeing my shares move higher, was the news that the oil move was based upon.
It was the same news from about a month ago when there was a report that there would be a cut in oil production agreed to by OPEC and non-OPEC members.
Oil and stocks soared on that news, until someone realized that Iran wasn’t in agreement, just as they were ramping up to really start bringing product to market.
When the realization hit, oil and stocks reversed course.
Today, the rumor was that Saudi Arabia and Russia will agree to large cutbacks this coming Sunday.
As I said, I’ll believe it when I see it and I would expect Iran to announce it’s rushing in to fill any void left by those 2 big players, as if everyone else won’t be cheating, as well.
So today’s gain was really nice, but nothing would be better than some better than expected earnings reports starting tomorrow morning.