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The Standard and Poors index (SPX) posted a very strong day today, closing at 4370, up 49 points or +1.1%. But today’s gains barely pushed SPX back into the positive column since SPX opened the week at 4356. SPX did set a new all-time closing high today, but that followed an extremely weak day yesterday. The markets essentially made a round trip this week and the trend of consistent below average trading volume continued.

VIX, the volatility index for the S&P 500 options, spiked up over 21% yesterday and pulled back a bit to close at 19%. VIX opened today at 18% and closed at 16.2%, a little more reasonable level of volatility.

I was concerned about the Russell 2000 index earlier this week as it sold off much more strongly than its big brothers, SPX and NASDAQ. The ETF for the Russell 2000, IWM, gapped down on Thursday but recovered most of that loss by the close. IWM opened today with a gap opening higher and continued its climb all day, closing at its high for the day. IWM also recovered its 50 dma today for a dramatic two day recovery of a substantial portion of its earlier losses this week.

The NASDAQ Composite index posted a strong two-day run, closing at 14702 today, up 142 or 1%. However, that barely put NASDAQ in the black for the week, up only 0.3%. Today’s close posted a new closing high for NASDAQ (Wednesday’s open was higher, but it couldn't hold it). Similar to the S&P 500, NASDAQ’s trading volume continued its below average track.

What a difference a week makes! Last week it seemed the market was just continuing a steady climb higher. Thursday’s significant gap opening lower certainly got my attention. But today’s strong performance across the board essentially returned us to the starting gate. The whipsawing of traders in and out of this market continues.

This is a nervous market. It doesn’t take much for the large institutional traders to hit the sell button. That makes it extremely difficult for you and me. It is easy to be crushed when that herd stampedes. We have to stay alert and remain focused on the risk.