On Friday, the market sell-off continued.
Still, it wasn’t pretty…
- Dow Jones -1.6%
- Nasdaq -1.8%
- S&P 500 -1.7%
- Russell 2000 -2.5%
All 11 sectors closed the day red.
- Healthcare (XLV), -0.5% was the smallest loser
At the bottom…
- Energy (XLE) -6.9% got crushed.
Crude oil is nearing its lowest levels of the year as the market braces for a global recession.
At writing, crude is trading near $78/barrel, down more than 40% from its peak in March.
The VIX finally broke out…
The falling resistance suggests the bottom may already be in.
But a final push lower for stock prices, especially intra-day, wouldn’t surprise us.
Our other indicators say a turn is near.
- RSI levels remain oversold for all four major indexes.
- The Put-to-Call Ratio has reached extreme oversold conditions.
Remember this … Market mechanics work like a rubber band. You can only stretch them so far.
At this point, the market is stretched out to the downside, about as low as it can go.
And while the short-term pain isn’t fun for investors, this market is providing an incredible buying opportunity.
The question we are asking ourselves this morning is this: “who is still waiting to sell?”
- The shock and awe of the Fed & inflation are behind us
- The market is forward-looking…
- Without new sellers, the market is poised to move higher.
As we wrap up Q3 this week, we are exiting the known weak spot in the 4-year political cycle.
We’ll bring you the latest on the incoming “sweet spot” later this week.
FENC support at $7.50
DCPH support at $18
RVNC support at $25
^SGML support at $25
SAVA support at $40
FREY on watch
CANO support at $8