TAPE is under severe selling after emerging market weakness is giving "fundamental weakness to US equities"
Emerging market issues do not last one or two days, it is a "structural defect taking place" which takes time to settle down.
Nasdaq is only 46 points above 50 DMA, which may not last on Monday.
Dow & S&P 500 are well below 50 DMA.....
Many technicians & this BLOG has been hinting @ weakness in US markets which may take us down to 1750 area, there is support around 1760 area but it may not hold.
IBD has also changed its market outlook to "uptrend under pressure"
VIX jumped 31.74% to 18.14, this is not to be taken lightly, VIX may go to 21.91 in a hurry with a further upside to 24 area......
Many key events are taking place this week :
-Monday AAPL earning report
-Tuesday State of the union
-Wednesday Fed policy announcement
-Thursday AMZN & GOOG earning
Based on the negative sentiment any weakness in any earning report may be punished.
Chinese stocks are breaking down badly including solar.
Even Airlines earning report are not being rewarded.
Fed will continue tapering which may not sit well with bullish expectation.
All in all "more pain on the way"
It is OK to ride this storm with current portfolio IF they are acting reasonably well, IF NOT changes must be made to better position.
On Friday, we entered a sharply down market & it may have more room to the downside.
Understand this TAPE & adjust accordingly.
It gets very painful until we find support.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hey Saleem,
There's a lot going on this week with earnings, the Fed, global worries, and economic data. The technicals are horrible as you mentioned. Yet, I feel comfortable in my positions. I don't know if this is being in the right stocks, or being ignorant of the market signs of a downturn. I'm sure this week will give more signals.
Stocktrader
Hi Stocktrader,
As long as one can ride this "storm"...everything in the end will come out OK...i hope !!!!
I see "serious trouble" for few days........
Quite alarmed @ breakdown of 50 DMA in markets & many stocks...not healthy @ all.
Saleem
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