An earlier post wondered if the last 2 days was an expiration bear raid or something else. One speculation was whether sovereign CDS would actually trigger a credit event. The morning news out of Europe has the tone of giving up on the Common Market Project-part bailout fatigue no doubt and resolution will take forever. Without the promise of endless bailouts, you have to wonder what will prop up equity prices. Do I have to remake myself as a political analyst now?
Meanwhile, domestic equity markets continue their shenanigans, futures up big and selling off in the pre-market. Some of that must be morning short covering, but I think too that more people are catching on– big drops are followed immediately by biggish pops. So, this pattern cannot last too long either.
In the very short term, I suspect much of the expiration driven action is over. Turkey weeks are particularly slow and somewhat bullish biased. Nibble,nibble not gobble, gobble!