"After a volatile start to February, things are calming down some today as the market is catching its breath," said Schaeffer's Senior Technical Strategist Ryan Detrick, CMT, as the Dow Jones Industrial Average (DJI) was little changed on the day after a strong finish to the month last week. "With both 1,500 on the S&P 500 Index (SPX) and 14,000 on the Dow out there, some type of consolidating near these levels makes sense."
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After three straight days with point swings of 90 or more, the Dow Jones Industrial Average (DJI) was slightly less volatile today, but still rallied toward the close for the second straight winning day. The Dow finished at 13,986.52, gaining just 7 points, or less than 0.1%. 3M Co (NYSE:MMM) led the 19 advancers, jumping 1.2% to hit a new annual high. The 11 decliners were led by semiconductor concern Intel (NASDAQ:INTC), which lost 0.9%.
The S&P 500 Index (SPX) also gained slightly, picking up less than 1 point, or 0.1%, to close at 1,512.12. Yet it was the seventh time in nine trading days that the SPX stayed above 1,500. The Nasdaq Composite (COMP) fell 3 points, or 0.1%, to finish at 3,168.48.
The CBOE Volatility Index (VIX) dropped 2.3% to finish at 13.41.
A Trader's Take:
"The overwhelming consensus is we've gone too far, too fast, and a pullback is due," Detrick said. "Although February is one of the weaker months going back 20 years, it is worth noting that a strong January (like we had) usually leads to a decent February. I'm not sure I'd say a big pullback is due, but potentially some sideways consolidation could be in the cards."
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