Based in Kingsport, TN – Written by the iInvest® Team
NYSE and Small Caps (Russell 2000) reach key Support Zone
In the iInvest® December 22, 2018 ALERT, we pointed out how unprecedented it was to see significant market declines following such large Institutional “smart money” program buying, as they stepped in to support key levels in the U.S. equities markets throughout all of 2018, also just days before this sudden move down. Usually, when the larger market makers take action in this way it’s very telling, and it pays for investors to take notice. Institutional program buying can be early or late, but the moves we have seen the last couple weeks are very uncommon, showing the power of fear in the markets, the strongest human emotion. Additionally, the increased use of algorithms in trading has added to today’s volatility, thus increasing the likelihood of “flash crashes”.
As you can see below, the NYSE, a good index to measure the overall breadth of the market, has rapidly landed into a strong support zone from the 2015-2016 weakness. This area will be watched closely by the iInvest® Team in the days ahead for a significant reversal, and we will keep you informed as it unfolds.
NYSE oversold and at a strong long-term support zone
The Russell 2000 (small caps), often a leading index of the overall stock market, is also nearing a key support zone, while at the same time reaching an oversold condition on a long-term chart. iInvest® will be watching for a signficant and telling reversal in the days/weeks ahead.
Russell 2000 oversold and at a strong long-term support zone
Written by Craig Dillon
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