US stock market is in deepest technical trouble since 2008.
US stocks are making new lows in many many sectors, some are making 2 year lows
We have come down fast in a hurry taking out key technical levels since Wednesday's Fed meeting.
YES we are deeply oversold....
YES we are ready for a bounce.....
How long this deeply oversold bounce will last, based on technical weakness, we may make lower highs and then lower lows.
The bigger question IS, IF we are heading to new lows, then 2000+ is next support.....
This may take few months like end of this year....
Based on technical picture, every trader and investor has to factor this new lows scenario.
Portfolio needs to be based on conviction and then show patience, it may be a very long haul before you see green in your portfolio.
A broad based portfolio with exposure to many sectors should workout, no more hoping for a or many homeruns....
Based on RSI read as of Friday's close :
DOW 27.39
S&P 500 28.90
Russell 2000 28.91
XLB 29.21
Nasdaq 29.90
JETS 29.90
GLD 30.29
SOX 30.60
TAN 32.12
XLE 32.13
Based on above read, you can quickly see that in my universe of sectors strongest read is 32.13 which is XLE.
Four sectors have violated June lows.....
DOW is @ below support and @ lower low...
SOX @ new low
XLB @ new low
JETS @ new low
GLD @ new low
All sectors are below both 50 & 200 DMA.....something rarely seen in markets...
Understanding the under pinning is extremely important.
Investment & trading expectation needs to be realistic
Being prepared for worst scenario can be a good strategy, it definitely will bring your expectations way down which may be good for stress management......
Good luck with your own understanding of this market.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hi Saleem,
(Sorry for the morning delay!)
Last week: -13.98% (YTD: -24.24%)
Notable Leaders: none
Notable Laggards: all
It was the most brutal week I can recall for the portfolio, even in the worst of times, but maybe that's a great sign of capitulation? I still contend that with inflation almost certainly having peaked already, brighter days should be ahead, but the Fed and investors are definitely not seeing it that way for now. I feel foolish for spouting any kind of optimism when things feel so terrible, but that's the way I've made some of the greatest gains in my history. Knowing how far we've fallen but having the portfolio on par or better than most major averages gives me comfort still. I will look to make opportunistic moves here, but staying full long at these levels.
Holdings: SYM ENVX PLAY IONQ GTLB LYFT SNAP FLL UPWK BMEA ZENV, cash 0%
Stocktrader
Hi Stocktrader,
Last week Down 10.94%
YTD Down 18.65%
Saleem
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