There is a tendency to blame the downside reversal in the market today on the elections in Italy. The idea of Italian elections being a catalyst for a market sell-off seems less likely than it being merely an excuse. Keep in mind, the market had already been displaying slowing upside momentum for much of February before violent indecision crept in last week.
To update my intraday look from last Friday, you can see the bulls struggled at the top purple line of price memory after staging a bounce late-last week into this morning. With more than ninety minutes to go in today’s session, I suspect that the close will be very telling here. Bulls likely need a close back above the lower purple line, or the case for a bull trap this morning becomes stronger. Which means reducing long exposure and playing defense comes to the forefront for swing traders.
Watch 151.50 into the bell.
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consumer still a big chunk of the economy…
JWN & WFM & AAPL all cater to the same customer…
JWN & WFM led > before the March bull start.. AAPL coincident…
Weekly charts of all three possible warning?
Interesting. They are all aspirational high end consumer brands.
good point, shift away from luxury and towards necessity?
Meanwhile HNZ, KO, PG, PEP, etc all moved higher on a price AND valuation level.
True, but that XLP ETF for the staples looks way too extended and crowded to me.
News might lead the markets, but most of the time the markets simply cause reporters to pull stories off the rack to suit the reality prevailing in the markets.
With slight permutations the main two stories are:
“Markets higher today due to the recent positive earnings reports of X and an improving Y”
“Markets lower today as politicians walk off a cliff and take their nations tumbling into the abyss – again.”
Any belief of a major policy change is going to cause massive shifts of capital and the first process before you move your capital anywhere will be into cash. But that is not a long term trend yet.