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There are difficult days to trade the S&P 500 index on a short-term basis and there are more difficult days. True to form, the index put the hurt to both the long and shorts, with sellers prevailing for the fourth day in a row.

Thursday marked the first “official” day of the index trading the December month as the “front” month, due to next week’s expiration of the September contract. Typically this two-day period is choppy and difficult to maneuver as longer-term investors attempt to maintain their long or short positions and “rollover” to the next expiring contract. As a result of this quarterly occurrence, there are gaps of liquidity in one or both of contracts that creates air pockets in both contracts.

That perfectly sums up Thursday’s price action. While the bears took control in early premarket trading, taking the index beyond Wednesday’s low (4292) to 4585.50, bulls fought back leading up to the open of the regular session.

Somehow, the bullish momentum was aided by the announcement by the ECB of tapering rather than continued easing of their money supply. The rally off the open turned an earlier 27 handle decline into a short-lived 17 handle gain when the index peaked at 4529.50.

One can attribute the afternoon’s swoon to other factors, but the bottom line is the index was lower for the fourth day in a row for the first time since mid-June (we all know what happened after that). For the session, the index declined 20 handles to close at 4292.50. That marks the lowest close since August 26 (4466.50), which is the same time the index did not close above 4500.

The hint of the potential higher rates across the pond propelled JP Morgan (NYSE: JPM) to be the biggest gainer of the top components. For the session, the issue added $0.69 or 0.44 percent to close at $159.19. That was compared to the index’s decline of 0.46%.

Leading the charge on the downside was Johnson & Johnson (NYSE: JNJ), which was lower for the third day in a row, skidding $3.83 or 2.2 percent to close at $168.07.


PreMarket Prep Stock Of The Day: PulteHome Group (NYSE: PHM)

Tips for whether or not to attempt to “buy the dip”.

Read more about PHM here.