Wall Street trims half of Monday's losses, bulls still in cautious mode

• US indexes shrugged off the negative mood as yields retreated.
• Dow closed at 24,900, almost 1,900 points below its record high.

Movements in Wall Street were once again wild, but this time for good, as all of the three major indexes closed with strong gains, trimming half of Monday's crazy slumps. The DJIA closed at 24,912.77, up 567 points. The Nasdaq Composite gained 2.13% or 148 points to end at 7,115.88, while the S&P settled at 2,695.14 after adding 46 points.

The sour tone of US equities Monday spread like wildfire, leading to sharp declines in Asian and European markets this Tuesday while US indexes opened lower, but last little into negative territory. Speculative index fretted after T-yields soar to multi-year highs on Monday, on the back of speculation that inflation started picking up. Yields pulled back in intraday trading, with the 10-year note yield tumbling to 2.64% after hitting 2.88% at the beginning of the week, to finally settle at 2.77%.

The Dow closed the day above the 61.8% retracement of this week's decline at 24,593, as the index hit a low of 23,122 in pre-opening operations, following the route of its overseas counterparts. The sharp recovery came after the index tested its 200 DMA, and the positive impulse was also enough to send it above the 100 DMA. Nevertheless, the return of the bulls is yet to be seen, as, in the daily chart, the index remains far below a bearish 20 DMA, while technical indicators have barely corrected extreme oversold conditions.