While last week was up and down, this week could end up being just straight downwards as investors succumb to potentially sub-par data. This week, there is a lot of “real” data to contend with—data that actually has implication on the direction of the economy. If anything comes out slightly bad, investors could be prompted to start selling again.
Also not helping has been earnings season.
With the main reporting time underway, the pattern seems to be that firms are missing revenues, but still beating EPS numbers. The drop in sales, as well as lower guidance reports, have only increased the volatility of the markets. That should continue as we are now in the thick of earnings season.
At the end of the day, investors should be prepared to face another week of volatility.