Technology names, in particular, are starting to get into some rather scary areas from a technical perspective. The 6,600 level on the NDX is one of the most important the markets have recently faced. That's the hook and anchor for the markets until further notice.
There are schools of thought that cite statistical data showing seasonal strength into the final weeks of the year following mid-terms during a year when the markets were up until a couple weeks ago. The question is....Does the market completely ignoring what were some pretty compelling statistics about market performance into the end of this year make this a buying opportunity because the markets will eventually fall in line or is it a sign that the markets are broken?
If the technical damage wasn't so well defined we could very easily say it's the former. However, given the persistence of the decline along with the accompanying technical damage, it can be said with a good deal of confidence that the markets spitting in the face of compelling statistical data saying we should be soaring here adds to potpourri of negative data with respect to the condition of equities. Markets that are broken only care about one thing: Going lower until psychology dictates that prices can stabilize.
Those who think this is a simple aberration, with the markets quickly returning to their former self are sure to be disappointed. As I wrote earlier this year, everything has changed in 2018. The markets going forward, while continuing the general bullish trend in 2019, will look nothing like the past several years.
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