By Nicholas Santiago on March 19th, 2010 3:39pm Eastern Time
As many of our readers know by now we rarely have a big down Friday ahead of a weekend. We believe that the institutional money that can move this market does not want to cause panic in the consumer that is likely to spend money on his or her day off over the weekend. The other reason we believe that we do not see a sharp sell off on a Friday is so that panic or fear does not spook the Asian markets over the weekend.
Often in the final hour of trading the SPDR S&P 500 ETF (NYSE:SPY), SPDR Dow Jones Industrial Average ETF (NYSE:DIA), PowerShares QQQ Trust, Series 1 (ETF) (NASDAQ:QQQQ), and the iShares Russell 2000 Index ETF(NYSE:IWM) have caught bids into the close. This can be seen on any intra-day chart as the indexes have volume during the first hour of the trading day and then it rallies in the final 30 minutes of the day.
Today should not be any different from any other day. The volume is still light especially for a quadruple witching options expiration day. Even when the market closes negative on a Friday rarely will it be down sharply.
The volume during the month of March has been exceptionally light. Historically, th month of March is one of the heaviest volume months of the year. So far the volume this March is rivaling August which is known as the peak of the summer doldrums. Therefore, when you combine the light volume with options expiration and S&P 500 re-balancing anything can happen into the close. Perhaps this market will close down sharply into the close ahead of the weekend. We shall see.
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