Friday, May 18, 2012

Morning Market Analysis; The Weakness Continues




All of the above charts show that markets are getting hit harder.  MACDs are dropping; Bollinger Band width is increasing which indicates increased volatility.  The IWMs (top char) have fallen through support and are now at the 50% Fib level; The QQQs have fallen through support and are now at a Fib fan level (and are also just above the 200 day EMA); the SPYs are at the 200 day EMA.  Also note yesterday's volume spike. 

This is what a correcting market looks like.





At the same time, money is flowing into the Treasury market as a safe haven bid.  The entire curve is rallying, catching the safety bid. 

This is the direct result of the EU situation, along with a weakening US economy. Put another way; it's getting very ugly.