Sunday, January 6, 2013

The Low-Volatility Lullaby

As long as the market continues on its current trajectory today, the Dow Jones Industrial Average will have gone 44 straight sessions without falling more than 100 points, according to Dow Jones Newswires. That would equal the streak that ended in January 2011, and it shows just how much the market has calmed since the tumultuous second half of last year.

The lack of significant downside action for most of this year indicates that the market is comfortable with recent moves by European leaders to shore up the debt situation. Despite considerable grumbling, traders have tended to give approval when they’re forced to put their money where their mouth is.

If the Dow extends the streak beyond 44 days, the next milestone would be 96 days, which the market reached in January 2006.

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