Stock Market Supply Forces New Lows

Traders are looking for buyers, as the market breaks to new lows…

US Equity Markets have started the week where they left off Friday, with further momentum to the downside. At 1:00 pm the S&P 500, -1.8% at 1845  is on track to post its lowest close since April 2014.

NASDAQ, -2%+ at 4260 is still 1% higher than the October 15, 2014 close of 4215, but with 3 hours to go, and the volatility we’ve seen in the NASDAQ Average YTD, a close below that level is not out of reach.

Feb 8, 2016

Feb 8, 2016

The DJIA -1.9% at 15,900 is marginally higher than both the January 20 closing low of 15,766 and the August 25 closing low of 15,666.

The DJIA is getting some “cushion” from a dividend among many Blue Chip Stocks that easily beats the 1.75% yield on the US 10 year Treasury Note.

Oil is again a major contributor to the “Angst” rippling through the landscape for Investors and professional traders.  After holding the $30 level for the last 3 weeks, Oil is lower by 2% to 3% and the WTI contract is has been +/- $0.20 of the benchmark $30 level since early this morning.

Oil Stocks find Demand

While the damage among secondary and tertiary stocks in the oil sector is widespread, there are a handful of names bucking the trend in positive territory, clearly representing a flight to safety within the sector.  HES and COP +2%;  EOG, +1%;  XOM and CHV each

COP Feb 8, 2015

COP Feb 8, 2015

+0.5%  is a short list of names in the energy sector attracting investor attention in an otherwise very ugly day.

Gold +$38, which we rarely talk about is closing in on the $1200 level.  Seems to be a bit ahead of itself as the daily chart is starting to get a bit parabolic, but I’ll leave it at that as I really don’t follow it closely.

Market internals are decidedly negative with DVOL 7x UVOL and decliners leading advancing issues better than 5 to 1 on both NYSE and NASDAQ.

The Rest of the Trading Day?

spy updateIt’s worth noting that The S&P 500 has not closed below 1859 in close to 2 years; that would be April 2014.  On January 20, the S&P 500 hit 1812 intraday before rallying 45 handles to close at 1959.

Stock Market Supply Forces New Lows

On October 15 and 16 in 2014, the S&P hit 1820 and 1832 intraday before rallying sharply both days to close within a point of 1862 each day. A close below S&P 500 1850 would be significant and stoke the coals of the “Bear Market” case quite strongly.

That being said, there’s 3 hours left in the day and a lot can happen……..Stay Tuned.
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