The and ended the week down about 5% and 6%, respectively. It’s difficult to find many bright spots in this market, particularly where real interest rates are concerned.
Options expiration kept things from getting ugly on Friday; With $390 being the ETF’s big gamma level, put holders were looking to sell their puts at the end of the day when it became clear that the S&P 500 Index was failing to break the 3,840 support. With that, the market exited a late afternoon rally.
Internals on Friday were pretty bad though, particularly on the Nasdaq with 451 more new lows than new highs. That was the lowest value since early July.
More importantly, the cumulative new high minus the new low shows another new low, which I am in the cumulative count. This is something I don’t see as a positive for the market as a whole, and is just another warning sign that this market is about to make new lows sooner or later.
QQQ vs TIP
It lags the ETF by about 12 days, and the QQQ’s decline is on schedule. Based on the TIP, the QQQ is also unlikely to see a major recovery any time soon.
Regarding how the market is moving this week, I have decided to try not to predict weekly market movements this week as I don’t want this to be confused with my belief that the market is headed for the June lows . and I believe there is a high probability that they will make new lows. Additionally, the 2008 analog suggests that the outlook for the S&P 500 and Nasdaq through October 25 could be brutally painful.
Zoom Video (NASDAQ:) is the poster child for stocks making new lows on the Nasdaq as I think Zoom has been one of the best leading indicators of where the overall market is going. So it’s no surprise that Zoom just hit a new low on Friday. However, Zoom is also likely not finished falling either, with the following significant support at $76.45 and then $70.
If you want to see the impact a strong price is having around the world, look no further than the ETF, which made a new low on Friday and is likely to continue lower. The support at $38 has been broken and the next level of support is not until $36.45.
DocuSign (NASDAQ:) jumped after its , but this stock is no different than Zoom and those gains are melting away fast. Like Zoom, Docusign is likely to be included in shares on the Nasdaq and will make new lows very soon. There is no support until $46.85.
DoorDash (NYSE:) is getting ready to journey up the stairway to heaven with this massive descending triangle and is just above the $56.80 support. DoorDash will likely be another stock to add to the growing list of stocks making new lows.
Anyway, this is going to be a big week with the Fed and all; much luck.