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Today’s Summary
Thursday, August 17, 2023
Indices: S&P 500 -0.77% | Dow -0.84% | Nasdaq 100 -1.08% | Russell 2000 -1.15%
Sectors: 10 of the 11 sectors closed lower. Energy was the only sector that closed higher led, rising +1.20%. Consumer Discretionary lagged, dropping -1.69%.
Commodities: Crude Oil futures rose +1.27% to $80.39 per barrel. Gold futures fell for the ninth straight day by -0.68% to $1,915 per oz.
Currencies: The US Dollar Index was flat at $103.44.
Crypto: Bitcoin tumbled -7.17% to $26,642. Ethereum slid -6.76% to $1,684.
Interest Rates: The US 10-year Treasury yield rose to a fresh 15-year high of 4.280%.
Here are the best charts, articles, and ideas shared on the web today!
Chart of the Day
Best chart we saw for the bulls was the spike in Put/Call ratios yesterday. We prefer more persistence than 1-day for $SPX, but every journey starts with a first step. pic.twitter.com/Jqv5gxFhhi
— RenMac: Renaissance Macro Research (@RenMacLLC) August 17, 2023
Today’s Chart of the Day was shared by Renaissance Macro Research (@RenMacLLC). The S&P 500 has pulled back -4.76% from its July 31st highs. Leading up to this pullback, the bull camp was getting crowded. Even the loudest bears had thrown in the towel and were suddenly singing a more optimistic tune. It seemed like the only fear among market participants in July was the fear of missing out. However, we’re starting to see signs of genuine fear, and that’s bullish. Renaissance points out that the Put/Call ratio is spiking as investors look to protect themselves against further downside. It can be challenging to time the market using sentiment, and the Put/Call ratio could spike even further before stocks rebound. However, this mild pullback is doing a lot to extinguish the froth and reset sentiment to more sustainable levels.
Quote of the Day
“Allied to the general pattern of market movements is the general pattern of speculative thinking.”
-Benjamin Graham
Top Links
Bulls Back Off – Bespoke
Bespoke analyzes the results of the latest AAII Sentiment Survey.
Now They Turn Bullish? – Carson Research
Ryan Detrick takes a longer-term look at sentiment.
VIX Seasonality – The Weekly ChartStorm
Callum Thomas points out that volatility tends to pick up around this time of year.
Tech Stocks versus Interest Rates Reaching Breaking Point! – See It Market
Chris Kimble looks at the relationship between Treasury Bonds ($TLT) and the Nasdaq ($QQQ).
The Bond Market Remains Stress-Free – All Star Charts
Ian Culley looks at credit spreads and what they suggest for equities.
Top Tweets
#Stocks are feeling the heat in August. The S&P 500 fell 0.77% today, declining for the 10th time out of 13 trading days this month. Energy is the only sector that is positive MTD (+0.03%). Fed uncertainty is weighing on #markets. pic.twitter.com/FHoRhyozCW
— Cetera Investment Management (@ceteraIM) August 17, 2023
This feels like a long time ago $DJIA pic.twitter.com/3yHoHTww3y
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) August 17, 2023
To get a sense of how much the Nasdaq 100 ran up prior to this pullback, the index is down 7% from its highs but would need to fall another 11.4% to get down to its 200-DMA. A drop to the 200-DMA would be an 18% correction (almost a new bear market). pic.twitter.com/bChXTjcrXM
— Bespoke (@bespokeinvest) August 17, 2023
#sentiment Took a huge nose dive, below March lows. Fear / Greed model from @sentimentrader $SPY $QQQ pic.twitter.com/4UETrDC5Ow
— Victor Riesco, CMT (@Global_Trader) August 17, 2023
5-d $CPCE highest since early March. Usually (not always) near the low in $SPX, w/ near term R/R tilted higher pic.twitter.com/J7QzBYhSO8
— Urban Carmel (@ukarlewitz) August 17, 2023
S&P 500 stocks below their 20-day moving average are entering the buy zone.
However, you usually want to see a turn before buying too much. $SPY $SPX pic.twitter.com/d6h0l76ZdO
— Matthew Timpane, CMT (@mtimpane) August 17, 2023
Stocks go up and down (but usually up).
The avg yr sees more than 3 separate 5% corrections per yr.
S&P 500 down 4.8% from the late July peak right now, so on the edge of the second 5% pullback this yr.
This is normal action after a huge rally into a seasonally weak period. pic.twitter.com/kh4U22AlBp
— Ryan Detrick, CMT (@RyanDetrick) August 17, 2023
Is it me or are growth stocks trading like they just found out rates are heading higher and staying there longer?$QQQ $TLT pic.twitter.com/u9W1EFYivl
— Steven Strazza (@sstrazza) August 17, 2023
People will argue about exactly what an upside breakout in long-term treasury yields – or a failure to breakout – might mean for the financial markets.
Either way, this seems like an important one to keep an eye on. @sentimentrader pic.twitter.com/gk19qMJhqj— Jay Kaeppel (@jaykaeppel) August 17, 2023
Dollar making its presence known. $UUP headed for highest weekly close since late 2022. Looking bullish.
Remember, risk assets don't like it when the dollar is ripping to the upside. $USD $DXY pic.twitter.com/dqlSyegNxe
— Justin Spittler (@JSpitTrades) August 17, 2023
Today is the 9th consecutive red daily candle for Comex gold.
Note that nearly all of the big red hourly candles have occurred during Comex trading hours as HFT algos react to higher nominal rates and a rising $DXY by selling and shorting Comex Digital Gold contracts. pic.twitter.com/nSClF3Vkn9— TF Metals Report (@TFMetals) August 17, 2023
Finally! Some god damn movement $BTC pic.twitter.com/CB0lBGzAHD
— Michael Nauss, CMT, CAIA 🇨🇦 (@MichaelNaussCMT) August 17, 2023