12-04-2018 Todd’s Market Update

Bears Return, VIX Clears 20

U.S. markets opened lower with the losses accelerating into the second half of action as fears of an inverted yield curve spooked Wall Street. It also appears that the U.S.-Sino deal was an agreement to agree, following more trade rhetoric, with much of the heavy lifting on detail yet to be done in the first three months of the year.

The Bush memorial ahead of the market closure tomorrow, caused a 25% spike in volatility with the VIX closing above a key level of resistance.

The Russell 2000 plummeted 4.4% after trading to an intraday low of 1,479. Prior and upper support at 1,480-1,460 was breached but held with a close below the latter leading to fresh and prior October lows.

The Nasdaq stumbled 3.8% following the backtest to 7,150. Upper support at 7,150-7,100 held with a move below the latter signaling additional risk towards 7,000-6,900.

The S&P 500 sank 3.2% following the pullback to 2,697. Major and upper support at 2,700-2,675 held with risk to 2,625-2,600 and fresh October lows on a move below 2,675.

The Dow tumbled 3.1% after testing a session low of 25,008. Shaky support at 25,000-24,800 held on the close back below the 200-day moving average held with risk to 24,600-24,400 on continued selling pressure.

Utilities were the only sector to show strength after climbing 0.1%

Industrials were the the worst performing sector after sinking 4.4%. Technology and Consumer Discretionary dropped 3.8% and 3.6%, respectively.


AT&T (T) upgraded to Outperform from Market Perform at Cowen
First Solar (FSLR) upgraded to Neutral from Sell at Goldman Sachs
Roku (ROKU) upgraded to Buy from Neutral at DA Davidson

Costco (COST) downgraded to Neutral from Buy at Citi
LabCorp (LH) downgraded to Hold from Buy at Craig-Hallum
Quest Diagnostics (DGX) downgraded to Neutral from Buy at BofA/Merrill


Wednesday's earnings announcements (EST): 

Market closed to honor George H.W. Bush

Wednesday's Economic Reports (EST):
No major announcements


Gold closed at $1,241.10 an ounce, up $7.20
Silver settled at $14.64 an ounce, up $0.14

Copper finished at $2.76 a pound, down $0.05

Crude Oil is at $52.68 a barrel, down $0.57

Bitcoin Investment Trust (GBTC) ended at $4.51
down $0.24

  I hope this helps you prepare for the trading day. Make it a great one!

   Todd Mitchell

Bears Return, VIX Clears 20

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