$SPY October is set up
to be another volatile month. Although the three major indexes are holding up
relatively well, the rest of the market continues to deteriorate. The Russell
2000 small-cap index fell below its August low today. Its support now stands at
1100, followed by 1082. The S&P 400 mid-cap index (1370.97) broke under its
200-day moving average. A break below the 1350-1356 area would suggest an end
of the uptrend started in November of 2012.
With the Fed ending its
QE in October, things can get a little harder for the bulls. After the Fed
ended its QE1 (March 2010) and QE2 (June 2011), stocks started a correction
within a month in both times. If history repeats, a correction could be in the
cards for this fall.
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