Everyone wants to know if Thursday was the bottom. It’s hard to call one while roughly 60% of stocks still sit below their 200-day averages.
Much of Thursday’s drop was mechanical. By one estimate, ETF selling made up about 32% of the day’s volume. Those funds sell regardless of price.
Trend-following funds have flipped short. They probably have around $50 billion left to unload.
CPI lands tomorrow on top of all that. San Francisco Fed President Mary Daly said Friday the Fed will probably need to raise rates again, even after last week’s tech rout.
I won’t fault anyone for buying this bounce. Just be careful with it. This market remains very vulnerable. There could be another leg down.