2 I’m running through my usual analysis and was struck by the swath of destruction that has torn through the stock exchange. I have been collecting this data for quite a while now and have never seen anything quite like this.
The table that follows is populated by industry groups (categorized by sector) and the percentage of stocks in each group that are above their quarterly (63 day) EMA and monthly (21 day) EMA. Any time these readings go below 10% I start paying attention. There is not a single stock in the financial sector (that trades over 1 million shares and is currently trading above $5/share) that closed above it’s monthly EMA!? 2 of the 3 groups in the industrial sector failed to have a stock close above the quarterly OR monthly EMA. This is truly “broken elevator” shit going on here.
| Industry (# of stocks) | % Above Quarterly (63) EMA |
% Above Monthly (21) EMA |
| Chemicals (13) | 8% | 0% |
| Energy (99) | 5% | 5% |
| Metals and Mining (55) | 4% | 2% |
| Conglomerates (6) | 0% | 0% |
| Consumer Durables (16) | 6% | 0% |
| Consumer Non-Durables (22) | 14% | 9% |
| Automotive (19) | 0% | 5% |
| Food and Beverage (30) | 40% | 33% |
| Tobacco (4) | 25% | 25% |
| Banking (38) | 0% | 0% |
| Financial Services (33) | 6% | 0% |
| Insurance (27) | 15% | 0% |
| Real Estate (43) | 23% | 0% |
| Drugs (52) | 42% | 27% |
| Health Services (27) | 7% | 4% |
| Aerospace/Defense (10) | 0% | 0% |
| Manufacturing (24) | 0% | 0% |
| Materials and Construction (20) | 35% | 5% |
| Leisure (21) | 33% | 14% |
| Media (26) | 12% | 19% |
| Retail (34) | 26% | 9% |
| Specialty Retail (27) | 22% | 7% |
| Wholesale (6) | 17% | 0% |
| Diversified Services (23) | 4% | 0% |
| Transportation (16) | 25% | 6% |
| Computer Hardware (18) | 6% | 0% |
| Computer Software and Services (42) | 10% | 5% |
| Electronics (60) | 7% | 10% |
| Telecommunications (34) | 12% | 9% |
| Internet (19) | 32% | 26% |
| Utilities (33) | 61% | 33% |
I have made the decision to ride this out in my account…thankfully I have had enough going on in the “real” world (and enough in $MO and cash) to keep me from getting too crazy over this. Needless to say, I have been taking repeated liver punches. I’ll survive, but a bounce would be just fucking dandy at this point.
My best to you all.
-EM
2 Responses to “Extensive Carnage”
heaterman
That data does indeed display what has been going on. The question is whether it will continue to spiral or plunge downward or whether it stabilizes or rallies from here.
elizamae
I think we are likely to see things bounce quite violently, but sharp “V” shaped bottoms that form on the initial plunge lower rarely hold. I do think that as the rebound materializes, it will offer a much better opportunity to put on some short trades. If it is a violent rally, the bottom we put in will likely be tested again at some point in the near future.
Thanks for reading.