US (and Japanese) stocks began their dead-cat bounce around the European open tracking USDJPY (once again) and rising in reverse order of yesterday's selloff as Nikkei, Trannies, Nasdaq and so on (in order) recovered around 25-35% of yesterday's losses. For Fibonacci-watchers, S&P futures ticked 38.2% retracement and stalled and VWAP was support all day. Credit markets did not buy it and stocks caught down to them. Silver, having underperformed since the taper, outperformed today back over $19.50 and +1.7% on the week as gold slipped modestly today (but +0.8% on the week). Treasuries sold off modestly leaving yields -2-3bps on the week. AUD stength and JPY weakness supported stocks but the USD flatlined ahead of tomorrow's ECB meeting. MUB, the Muni ETF, was smashed lower on the Puero Rico junking (and that triggered a quick waterfall in stocks) but that was quickli BTFD'd. VIX fell an impressive 2.9 vols to 18.5%, which is notable since stocks 'underperformed' the hedge cover by a long way.
The S&P 500 remains below its 100DMA, The Dow closed below its 200DMA once again; and Trannies bounced off the 100DMA
The bounce in context… 38.2% in the S&P 500…
Credit markets acted as support as stocks kept bouncing back down to reality….
Trannies and Nasdaq inch back into the green post-Taper…
The bounce in stocks was all about USDJPY yet again…
Over the 2 days – stocks are still down markedly
Copper and Oil recovered to unch on the week as Silver outperformed on the day…
Treasuries sold off modestly but remain lower in yield on the week…
The USD looks flat (as EUR trod water ahead of tomorrow's ECB meeting) but the AUD and JPY move was impressive…
Charts: Bloomberg
Bonus Chart: When PR was downgraded, MUB (the Muni ETF) was hammered lower…
Bonus Bonus Chart: The Nikkei is roaring back relative to the Dow… for now…
via Zero Hedge http://ift.tt/1jd07Uv Tyler Durden