Today the Nasdaq 100 ETF (QQQ), S&P 500 ETF (SPY), and Dow Jones Industrial Average ETF (DIA) closed near the September 21st lows which we noted as possible support.
While we rallied intraday, we also sold off, giving back most of the days upward progress.
The Volatility Index ETF (VXX) also failed to break through the 50-day moving average to the upside, but It’s still over prior days low and could be poised to test the moving average again.
Buyers came back to the Junk Bonds ETF (JNK) today bringing it up to the 200-day moving average, which it did not hold. Now it sits under the prior days close.
With current market conditions looking weaker, we could see a break down for lower levels, which is why I’m watching a solid break below the September 21st lows.
We should also consider that there are only 39 days left until the presidential election. Soon debates will be held discussing future polices, therein shaping the minds of what emerging trends people should begin investing in.
This could make for an even choppier market environment going forwards.
Combined with possible consolidation in this area, we can expect more large volatile days.
Our ongoing theory that a continued selloff could create a timelier push for the stimulus bill being passed is still on my mind.
Waiting for some good news to come in and save the market isn’t out of the question and could just be a matter of when.
Knowing the stimulus bill could have a negative impact on this coming election gives more pressure for it to be passed in these upcoming weeks.
For now, we should hold tight, watch our key levels, and keep eyes on the VXX and JNK.
S&P 500 (SPY) Still holding over 322 support. If breaks 310 next major support level.
Russell 2000 (IWM) Almost where it started. Still needs to break and hold over 200-DMA
Dow Jones Industrials (DIA) 263 support but first we have the 9/21 lows
Nasdaq (QQQ) 260 key and then 233 the 200-DMA
KRE (Regional Banks) Trying to hold 34, but could see 32 next
SMH (Semiconductors) Holding 164. 169 resistance
IYT (Transportation) 195 support
IBB (Biotechnology) Broke 132, watching for a continue down to 126
XRT (Retail) If can’t move up past 50 then watching for a move lower to 45
The author may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.