FXTM information and reviews
IronFX information and reviews
Libertex information and reviews
FXCC information and reviews
Markets.com information and reviews
FxPro information and reviews
48 224.00

S&P 500 flirts with technical correction

24 September 2020

The September selloff in US stocks doesn’t seem to be letting up. The S&P 500 is now flirting with a technical correction, which is when the price of an asset falls 10 percent or more from its recent high. The US benchmark equity index is now about 0.4 percentage points away from meeting that criteria, headed for its 100-day simple moving average (MA), with its futures flat during the Asian morning session.

Wednesday’s US session also saw the Nasdaq 100 (NDX) posting its first daily loss so far this week, leaning further into its correction. The tech-heavy index is now 10.55 percent lower on a month-to-date basis, and has fallen by around 13 percent from its record high. The NDX also appears set on a path towards its 100-day simple moving average, although Nasdaq 100 minis are noticeably undecided about whether to extend losses at the time of writing. Still, its 50-day counterpart now provides immediate resistance.

Note that the respective 14-day relative strength indexes for the S&P 500 and the Nasdaq 100 have yet to hit the 30 threshold, a level which denotes oversold conditions. That suggests that US stocks could yet see more declines over the near-term.

Investors are coming to terms with the idea that the next round of US fiscal stimulus won’t arrive before the US elections, despite the repeated stresses by Fed officials that more government financial support is needed in order to sustain the still-nascent economic recovery. The spectre of drawn-out political uncertainty even after the November 3rd elections is also casting a huge dark cloud over market sentiment.

Yet judging by some indicators, some market participants don’t seem too particularly alarmed. The VIX index, which is widely seen as Wall Street’s fear gauge, has actually moderated since making a run towards the 40 level earlier this month. The VIX now reads below 30, and is testing its 200-day simple moving average, which is also serving as its immediate resistance line. The CBOE’s put options to call options ratio is still around half compared to levels seen during the market crash in March.

Equity bulls and bear are expected to continue duking it out in dictating how much longer the current selloff will persist. Although the longer-term investor will be heartened by the Fed’s lower-for-longer rates mantra, which should be supportive for stocks for years to come, perhaps they’ll just have to weather these near-term bumps along the way. At the time of writing, the FXTM trader sentiment remains net long on both the SP500m as well as the ND100m.



Dollar jumps, gold slumps, stocks nervous
Dollar jumps, gold slumps, stocks nervous

Worries that the US consumer is rolling over were dealt a major blow yesterday after the nation’s retail sales for August overpowered some gloomy forecasts. The retail sales...

17 Sep 2021

Energy is the play: how we get to $100 crude
Energy is the play: how we get to $100 crude

Natural gas futures in Europe and the UK are flying, while our natural gas (NG) CFD (the underlying is traded on the NYMEX) pushed over $5.60 and into 7-year highs...

16 Sep 2021

Are investors sleeping on systematic risk in China?
Are investors sleeping on systematic risk in China?

It’s time to talk about China. The situation is getting dicier as the nation’s second-largest property developer - Evergrande - is on the verge of default. Trading in the company...

16 Sep 2021

Sentiment sours as the S&P 500 tests key support
Sentiment sours as the S&P 500 tests key support

We head to quadruple witching in the US on Friday and notably options expiration (OPEX), and the weakness we see time and again in the week before seems...

15 Sep 2021

Dollar unscathed by soft inflation, equities resume slide
Dollar unscathed by soft inflation, equities resume slide

Dollar takes little damage despite signs US inflation has peaked - Wall Street resumes selloff - all eyes on China contagion risks - Canadian data coming up ahead of elections, gold wakes up...

15 Sep 2021

US inflation under the microscope
US inflation under the microscope

With the Fed having almost locked in a November taper announcement, the question now is whether Chairman Powell will use next week’s policy meeting to give the markets...

14 Sep 2021

Forex Forecasts

OctaFX information and reviews
HotForex information and reviews
XM information and reviews
FXCM information and reviews
Vantage FX information and reviews
Vantage FX
Moneta Markets information and reviews
Moneta Markets

© 2006-2021 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.