The S&P 500 bounced back yesterday after the previous day's interruption of a two-day rally. The day was light on economic news, but a buy-the-dip mentality apparently prevailed in advance of the 2 PM Fed minutes, which triggered some momentary volatility that only momentarily interrupted the trend. The index closed the session with a 0.81% gain, just fractionally below its intraday high.
Meanwhile, the yield on the 10-year note closed at 2.54%, up 2 bps from yesterday's close and 4 bps above the 2014 low.
Here is a snapshot of the week thus far; which is up 0.54%.
Here is a daily chart of the SPY ETF (ARCA:SPY). Despite today's advance, volume suggests that sentiment remains cautious. Today's volume was 20% below its 50-day MA. With a handful of exceptions, the high volume days of 2014 have been on declines.
Here is a monthly chart on which I've highlighted the four index declines beginning with the Financial Crisis trough. It's been a while since we've seen anything even vaguely reminiscent of a correction.
Another Perspective on Drawdowns
The chart below uses the percent-off-high strategy for illustrating the drawdowns greater than 5% since the trough in 2009.
The S&P 500 is now up 2.15% for 2014.
Here is a pair of charts based on daily closes starting with the all-time high prior to the Great Recession.
