Nasdaq: -47.16… S&P: -9.28.
The market was down today, but not like a down 2% day, but some stocks were down 40-50% and many were down 5-10%.
The action in the four major indices really isn’t reflecting some of the carnage that’s out there. Biotechs are being thrown out the window with no mercy and stocks like FIT were down 40% and GPRO were down 30% after bad earnings. I could go on and on, but you get the picture. Pretty much land mines everywhere.
So the market in its own way, is correcting here. It’s punishing some stocks/sectors as it separates the wheat from the chaff. This has been a fairly stealth pullback as the Russell 2000 is down about 8% from its recent top, That’s a pretty decent pullback.
In looking at the underlying technicals, mainly RS (relative strength) and stochastics they are oversold enough right now to stage a decent countertrend rally. Although I have seen those numbers lower, where they get really oversold, and you feel better about buying with two hands blindfolded.
The McClellan Oscillator, which is a great measure of overbought and oversold, is at a point where the market usually bounces. See below.
Things do appear to be lining up for a rally, and I’ll have a tight leash on these shorts ,the question is whether it will stage something before election day on Tuesday.
Have a great night.