News:
Markets spent another day in the red on Thursday. The selling has accelerated since the latest Fed decision dropped.
The indexes plunged and settled at their session lows…
- Dow Jones -1.1%
- Nasdaq -1.8%
- S&P 500 -1.6%
- Russell 2000 -1.6%
10-year notes reached their highest levels since 2007 at 4.5% on Thursday. Higher long-term rates are thought to compete with stocks.
- If you can make guaranteed money, why risk losses in stocks?
- Investors appear to be rebalancing
Sector Round Up
All of the 11 sectors posted losses on Thursday.
Falling the least…
- Healthcare (XLV) -0.9%
- Utilities (XLU) -1.1%
- Communications (XLC) -1.2%
At the bottom…
- Materials (XLB) -2.0%
- Consumer Discretioary (XLY) -2.7%
- Real Estate (XLRE) -3.5%
Investors expect the higher interest rates to quell demand for real estate. The average 30-year mortgage rate is 7.42%
Technicals:
The S&P 500 has reached oversold conditions…
It’s also reached a short-term support level.
We know oversold conditions are unsustainable. We also know buyers like to buy at support.
This morning, futures are higher. We’re watching for signs of a turn.
Our take–The current selloff is likely to set up the last great buying opportunity of 2023.
Your latest readout…
- The VIX broke above 16 but is still relatively low
- RSI levels in 3 of the 4 major indexes are oversold, the Dow is close
- The put-to-call ratio is oversold
Timing:
After today’s session, there is just one full week of trading left in September.
Here’s what we’re looking forward to next week:
- The final Q2 GDP estimate drops Thursday morning
- PCE inflation report is scheduled for Friday
Watchlist:
*Low Float
^Open Position
*SHOT support at $1.40, resistance at $1.55
CABA support at $16
GIII support at $24
APLT support at $2
NN support at $5
TNGX support at $8.50 / $9
SCS support at $9
Secondary watchlist—float 100+ million
TALK support at $1.80