After a decent bounce off the opening low that tested and moved higher again, stocks are back at session lows and indeed cutting into new session lows.
Taxes are mentioned as one reason, but word out of the Middle East remains so rapid and volatile it is likely the real culprit. Saudi Arabia King is rumored to pass the torch to the crown prince as soon as this week. Saudi orders its citizens out of Lebanon in what is taken as a big step toward open conflict.
All indices are down with SOX and NASDAQ leading but the others are not far behind.
SP500 -18.31, -0.71%
NASDAQ -68.70, -1.01%
DJ30 -168.42, -0.71%
SP400 -0.69%
RUTX -0.54%
SOX -2.30%
NASDAQ 100 -1.07%
Note how SP500, DJ30, SP400 down equivalent amounts. Pretty even selling with the recent leaders taking more fire, often the case.
The moves have NASDAQ at the 10 day EMA, trying to hang on.
SP500 is below the 10 day, dangling over the 20 day.
DJ30 broke the 10 day rather easily and is also hanging over the 20 day.
SP400 is below the 20 day MA modestly.
RUTX is the relative strength leader as it avoided the Christmas rush and sold before the other indices. It is holding the 50 day MA's.
SOX gapped and continued lower to the 10 day EMA. That is quite a drop given the prior move.
A selling round hit the past hour that brought on some new session lows and panic. Watch to see if that is a false break and spurs some buying off an intraday double bottom. Will see if that plays out and if the afternoon session enjoys a change of character or continues to roll around in angst.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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