$SPX finally takes out the target I pointed to in the weekly news letter:
"...3806 - 3812. Same resistance I was pointing at last week."
I wouldn't be surprised to see the market continue to hold up, and even test the 3850 level, but this rally has been so weak, I can't get behind it.
Yesterday, we saw a Monday morning surprise take-down in US owned Chinese stocks.
Of course the News is all over the China story now, but I've been reporting on this, and pointing to the meltdown in China for weeks/ months.
In Market Update 10/12 - Let's take a look at what's really going on with this market - I talk about
"The Ongoing China Trade War!"
Of course, I'm looking forward to buying the bottom in Chinese stocks, as soon as I can confirm it, BUT
#CNBC Fast Money is in a hurry to catch a falling knife in Chinese stocks. I like the concept, but only fools rush in... #China #FastMoney
— Veteran Market Timer (@3Xtraders) October 24, 2022
As far as US equities are concerned, the market managed to shrug off the escalation of the US China cold war, but the market looks weak, and sell-offs typically happen one sector at a time. Sometimes reactions are delayed.
The UK simultaneously got a new Prime Minister, so some of what we saw yesterday, was a relief rally.
Next on the calendar:
1. FOMC Meeting next week
2. A Highly anticipated - supersized - move by the BOE
Bank of England to hike by 75 bps on Nov. 3 but may go bigger Reuters
That's 5 trading days away - plenty of time for a sharp correction
We've already seen Oil, and Natural Gas taken down, ahead of the mid-terms, and that sets the stage for the Fed to take their foot off the brake.
I'm outta time,
AA
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