10-11-2018 Trade of the Day

Bears Stay Aggressive

U.S. markets showed continued selling pressure on Thursday’s open before rebounding shortly afterwards and testing positive territory. However, sellers emerged in the second hour of trading and another selloff resumed.

The major indexes are suffering through their worst week since March with at least 65% of the S&P 500 now in correction territory or worse. Volatility reached its highest level in 8 months with Tech and the small-caps entering correction territory.

The Russell 2000 extended its losing streak to 6-straight sessions after giving back 1.9% and closing at a session low of 1,545. May and upper support at 1,550-1,540 was breached with a move below the latter signaling additional weakness.

The Dow dropped 2.1% following the intraday backtest of 24,899. Fresh and upper support at 25,000-24,800 was split with a move below the latter being a continued bearish development.

The S&P 500 also sank 2.1% after testing a second half low 2,710. July support at 2,725-2,700 is back in play with a close below the latter signaling lower lows.

The Nasdaq fell 1.3% following the intraday pullback to 7,274. Fresh and May support at 7,300-7,250 held with risk to 7,200-7,000 on continued selling pressure.

For the 2nd-straight session there was no sector strength.

Energy was the weakest sector after falling 3.4% while Financials and Real Estate were off 2.9%. Health Care dropped 2.7%


​GoDaddy (GDDY) upgraded to Buy from Neutral at Citi
Lear (LEA) upgraded to Buy from Neutral at Goldman Sachs
SiteOne Landscape (SITE) upgraded to Neutral from Sell at UBS
Ferrari (RACE) downgraded to Hold from Buy at Jefferies
Tata Motors (TTM) downgraded to Hold from Buy at HSBC
Valero (VLO) downgraded to Hold from Buy at Tudor Pickering


Friday's earnings announcements (EST): 

Before the open: ​Citigroup (CITI), First Republic Bank (FRC), JPMorgan Chase (JPM), PNC Bank (PNC), Wells Fargo (WFC)
After the close: ​​No major announcements

Friday's Economic Reports (EST):
Import and Export Prices - 8:30am
Consumer Sentiment - 10:00am
Charles Evans, Bostic Speak
Baker-Hughes Rig Count - 1:00pm


Gold closed at $1,277.60 an ounce, up $34.20

Silver settled at $14.61 an ounce, up $0.28

Copper finished at $2.80 a pound, up $0.02

Crude Oil is at $70.99 a barrel, down $2.18

Bitcoin Investment Trust (GBTC) ended at $6.78 down $0.53

   I hope this helps you prepare for tomorrow. Have a great evening.

   Todd Mitchell


Bears Stay Aggressive

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