If You Thought August Was Bad, Just Wait Until September!
BY CHRIS PUPLAVA
Up until August, this year had been fairly dull as the S&P 500 was in a trading range somewhere between 1250 and 1350. July ended near the upper end of that range and by August 2nd we were once again testing the lower 1250 level. Over the following week the S&P 500 plunged roughly 150 points to hit 1101 on August 8th before rallying. The selloff was due to a slew of negative economic releases which led to lowered economic growth expectations as well as renewed concerns over European sovereign debt markets and banks. Since August 8th the S&P 500 rallied just under 10% before selling off once more. The S&P 500’s trading range is now between 1205 and 1120, and unfortunately I think we may have another repeat in which negative economic releases and continued worries over Europe may see the current trading range broken to the downside with the markets erasing all of QE2’s rally from 2010.