Sentiment Gyrations as Covid Trade Strikes Back

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When the vaccine news broke, many of the names that were rallying in the gloom of lockdown sold-off sharply: so RMS, SNG, BRH all came off highs by 50% plus in a few trading days.  Pendular swings like these tend to equilibrate as reversion to a new mean kicks-in. In this frenetic CV19 market everything seems to be accelerated even as everyday life seems to have slowed. So BRH was below 30p on Tuesday now back above 50: RMS was below 1.5p now back above 4p while SNG dropped below 90p on Monday and was at 140p this am. Meanwhile on the "normality" trade CINE rallied to 67p(its 200MA which it rejected)  then puked back to below 40p this am (to its 8EMA where it bounced), RR rallied north of 140p then slumped to below 90p and so on

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These gyrations in price and sentiment do echo the age old adage coined by Ben Graham, in the short-term markets are voting machines, in the long-term they are weighing machines:  though these days timescale just get more compressed.

That many of the transports (FGP, EZJ, TRN) have all captured , checked and held their 200 MAs  suggests that normality, whatever that proves to be, is returning and the market is clearly signaling its view that the worst is now behind us.