We continue to watch markets slide as all markets are tanking, and few bids can be found as markets come unglued. We talked a week ago (wrote about) important levels for the upcoming decline, and we are approaching those after volatility post Martin Luther King Day closings.
Our proprietary model sees (using SPDR SP500 SPY) the market trading down to 177.68 and should hold and bounce to resume a slide to 160.08 (they are currently trading 182). This means down 6%, then another 14% from Pre-MLK trading.
We are on our way to completing a 25% move from the recovery highs in November after rebounding from the jolt of the August "Flash Crash." Few expected that rally, and it was a complete Yellen head fake into year end. So far, 2016 has been a horrific year for equities.
Markets need this healthy decline to survive, but make no mistake, we are in for a hard landing in equities, and the continuation of the move started back in Q4 2015. We are seeing support below in the S&P 500 and expect to get a small bounce before resuming a slide to the lower support levels listed above.
Currently markets are down across the board:
Dow -467 or (3%)
Nasdaq -117 or (2.5%)
S&P 500 - 67 or (3.5%)
Oil -1.84 or (7%)
VIX +6.5 to 32% Volatility
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