In focus: Volatility warning signs?

2015-01-03

Stocks stumbled into year-end, with a couple of down days, the second of which (today) was rather nasty.

But was this just illiquid, year-end manipulation (as the bulls suggest) or is something more serious occurring? It’s a little early to tell at this point, but if things don’t improve by Monday’s close, then the bears have a chance to engineer a correction. In some ways, this action seems similar to the end of 2007 to me. Early 2008 was a very bearish market, and so traders should be on high alert now.