The major indices wrapped up an extremely wild, volatile week with a second straight session of enormous gains. However, fully all of the advance was the result of another news-driven opening gap that disallowed for low-risk intraday buying opportunities. Stocks' opening prices marked their best levels of the day, as the main stock market indexes subsequently oscillated in a sideways to slightly lower range throughout the entire session. The S&P 500 zoomed 4.0%, the Nasdaq Composite 3.4%, and the Dow Jones Industrial Average 3.3%. Small and mid-caps again showed the most relative strength. The Russell 2000 and S&P Midcap 400 indices scored identical gains of 4.2%. That brought the two-day gain of the small-cap Russell 2000 to an unbelievable 11.2%! The major indices closed at, or just above, the middle of their intraday ranges, but near their weekly highs. Incredibly, the S&P 500 moved more than 4% on four separate days last week; two sessions were gains of more than 4%, two were losses of more than 4%. Wow!

On September 18, turnover surged to mark the most active day of the year, but last Friday's "quadruple witching" options expiration day caused total volume in the NYSE to rise another 15% above the previous day's level. Volume in the Nasdaq also remained well above average levels, but eased just 2%. The S&P 500's higher volume gain technically represented a second consecutive day of institutional buying (aka "accumulation day"), but turnover was undoubtedly inflated due to the simultaneous expiration of stock index futures, stock index options, stock options and single stock futures (SSF). In the NYSE, advancing volume handily outpaced declining volume by a margin of nearly 7 to 1. The Nasdaq adv/dec volume ratio was positive by just under 3 to 1.

As you probably heard by now, the SEC implemented a (temporary?) ban on short selling last week. As usual, the recent catastrophes in the financial sector have been blamed on "those darned short sellers," rather than the remote possibility of corporate American greed. So, what better way to fix the problem than creating risky imbalances in our free-market system by restricting the actions of the bears? Regardless of how you feel about this new rule, we wish to remind our subscribers that the Short and UltraShort ProShares ETFs create a very easy (and legal) way around the short selling ban. Designed to move in the inverse direction of their underlying components, these ETFs give traders and investors a simple way to take bearish positions through merely buying an ETF.