Up strong at the open and down on the day was how all the major indices took in Tuesday, a massive reversal beginning around 2:45 sent the Dow, NASDAQ and S&P into negative territory, calling into play one of the more obvious chart patterns, based mostly on rumors and fear.
The idea that WTI crude can continue to levitate above $50 per barrel for long is a rigger's pipe-dream and the kind of speculative plays that have been in play on the crude front seem ill-advised and doomed for failure.
In the dim afterglow of Friday's non-farm payroll disaster and the general under-performance of macro data for most of the year so far, stocks aren't looking exactly like the sure bet they've been the past six years running. The pattern, seen today, of a high rise at the open only to be finished off with unbridled selling pressure into the close would lead even the most bullish players searching for answers.
If the US economy is really on its knees - a view taking on more and more supporters - there is no turning back for most of the gamblers and speculators who have driven equities close to all-time highs. What may be even more puzzling, or troubling, is the fact that the major indices have fallen and flat-lined since their record closes in late February, and April hasn't provided any catalysts to send stocks back to those lofty levels.
That there is a creeping sentiment of FUD (fear, uncertainty, doubt) in the market should not come as a surprise. Most of the S&P 500 has been treading water in terms of real earnings, their EPS growth fueled by massive buybacks instead of capital investments, growth and taking market share, except in exceptional circumstances.
Today's action could be nothing more than advanced day-trading by pure speculators. Then again, we've been saying something is seriously wrong for months now, and yet, the markets have maintained an aura of invincibility.