Citigroup Rumors Spark Wildfire-like Selling

The markets were simply ugly today. The started down early, and hardly bounced at all. I thought we might see some type of rally attempt late in the day, but the selling pressure intensified and the indexes basically closed at their lows for the day.

There were the usual signs of panic selling. The ARMS Index hit 2.90, a very high level. And the volatility index (VIX) spiked fully +27% as fear reared its head.

Breadth was atrocious today. The advance/decline line was as bad as its been since July, and downside volume on the NYSE was 95%. That is enormous lop-sidedness. On the bright side, the last time we saw a 90% down volume day was Oct. 19th, and market a short-term bottom for the market.

The financials were down over -5.3% today, which pretty much made it impossible for the market to lift. While the bears will again point to today as the first day of the next, new bear market, I think today is just more noise to keep the majority off balance.

Tomorrow is the jobs report, which could go either way. But I think this weakness will subside in the near future, and the areas that have been showing bullish trends will resume their uptrends into year-end.