Three month T-bills selling at 48 basis points and overseas markets showing a 'Black Monday'. The SPX futures are currently down about 24 points as I type. How 'bad' is this?
As I wrote about last night, the extreme correlations argue that we can substitute the SP500 for much of the sector action. The TOUT TV Morning Cheerleaders have a bit more somber take today amidst global pain. London, Germany, and France all off 5 to 6 percent. Basic resources, insurance, banks and financial services taking on heavy water. Healthcare doing the best in Europe, over two percent.With the SPX futures off 24 points at 630 AM, that is STILL less than one volatility band (calculated above). Gold is up about twelve bucks on the presumption that rate cuts will follow.
Marc Faber's monthly commentary notes the Greenspan-Bernanke folly in establishing the excess credit/speculative bubble AND Bernanke's erroneous belief that Federal Reserve policy leading up to the depression wasn't the trigger (echo credit bubble).
The CARA 100 ranked by most oversold by stochastics and sorted by Worden TC2000. Note the Debt to equity ratios on the right._____________________________________________
Same stochastics weekly sort applied to the CHOSEN ONES.____________________________________________
So what's the plan? Lie low and let the wind blow. My largest positions remain cash, Hussman Strategic Growth, Gold equities, and I have both XLF calls (November) and SPX index puts that are offsetting hedges.
Good trading and great risk management to all.
Educational use only. Never intended as investment advice.
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