NEW YORK (CNNMoney) – “U.S.
stocks dropped Tuesday after the Federal Reserve indicated it was unlikely it
would offer more stimulus anytime soon.
Investors grew skittish after the Federal
Reserve released minutes from its most recent open committee meeting
around 2 p.m. The Fed's comments suggested that it was less likely the central
bank would intervene to help the markets unless growth slows.”
This time I think the
media-explainers are right: the market fell Tuesday right at 2PM, so there was
definite cause and effect. It’s an odd
reaction that is not uncommon. The
economy is getting better; the Fed chooses not to act; and the market
drops. Would investors rather have a
poor economy with Fed action than a better economy that doesn’t need Fed
action? Apparently, yes. Today’s action just looks like follow-thru to
me.
NEWS FROM EUROPE:
From ZeroHedge:
“European unemployment
figures continue to look nasty. Charts are exploding to the upside, as
unemployment hits 15 year highs.” Story and chart at...
WASHINGTON: “IMF managing
director Christine Lagarde implored the United
States to help back-stop debt-ridden European countries Tuesday, wading
neck-deep into bubbling US political waters.”
Full story …
WHAT! I
thought they solved that problem...not yet.
It’s still hanging around.
CORECTION COMING?
I wouldn’t be at all
concerned if the S&P 500 falls down to the bottom channel trend
line (that is now about 1390), so it's almost there. If the
S&P breaks the trendline significantly, it will probably drop to the
200-dMA or about 10% from today’s close.
I don’t see this as a crisis, you never know. Today is the kind of action I expect going
into a correction – more big up-days and big down-days. We’ll see if we have a big up-day tomorrow: Will
the dip-buyers move in?
THE MARKET
The S&P 500 was down 1%
Wednesday to 1399. VIX closed at 16.4,
up 5%.
The S&P 500 is 10%
above its 200-dMA.
NTSM
The NTSM analysis remains
HOLD today.
MY INVESTED POSITION
I bought back into the
stock market at S&P 500, 1155 on 7 Oct after the 6 Oct NTSM buy
signal. I remain 100% long in the
long-term portfolio (100% stocks in the 401k.). (See the page “How to Use the
NTSM System” – the link is on the right side of this page).
