{+++} Real tough day. It was a 2%+ down day pretty much across the board. I speak of sector ETF’s and sectors. Gold and silver was absolutely crushed. Many stocks and etf’s broke their respective 50 day moving averages.
XLB -Materials broke 50 day, down 2.58%
XHB– Housing broke 50 day moving average and uptrend line. down 4.83%
XLU– Utilities continued into the wood chipper and broke its 200 day moving average, down 2.8%
XLV– Health Care broke 50 day on big volume, down 2.7%
XLI– Industrials broke 50 day, down 2.8%
XBI– Biotech before today, spent the last three days under the 60 day moving average, but collapsed further today, down 3.44%
XLF Financials closed below 50 day ma, down 2.19%
XLP– Consumer Staples broke a bear flag and went even lower and looks lower, down 3,02%
XLE– broke 50 day hard and looks lower, down 2.92%
XLY– Consumer Discretionary broke its 50 day moving average, down 2.62%
GLD– was down 5.35%
You get the picture. The market isn’t ready for a world without QE yet. It will be someday. Last night I mentioned 1598 as a level to watch. I thought it might hold today, but once it broke that level it just collapsed. The SPX then tacked on another 10 handles lower (quickly) and closed near the lows at 1588.
I wrote last night that if 1598 gave way we could see 1570- 1580 is also initial support. In past corrections, it was easier to buy the dip with confidence because you knew you had the Fed in your corner. Now, although they will still be buying bonds for another year, (and wont raise rates for 2 years), the market perceives it as over. Perception was reality today.
My hindsight mirror is broken, but I wish I had taken more profits the last week or two. I also wish I was short. This has been an impossible market to short, but that was the trade the last two weeks, at the very least all cash. I wouldn’t short anything here unless more levels break.
Tomorrow is quadruple witching for options. Lets see if 1570-1580 holds tomorrow. Have a great night, get some rest and I’ll see you in the morning.
We’ll find a level soon.