Stock Traders in Risk Off Mode, DJIA Finished -4.6% on the Day

Stock Traders in Risk Off Mode, DJIA Finished -4.6% on the Day

Stock Traders in Risk Off Mode, DJIA Finished -4.6% on the Day


US stock indexes fell the most in 6.5 years, with the DJIA sinking more than 1,100 points, as the equity selloff extended on rising concern that inflation will force interest rates higher.

Volatility came back into US equity markets, as the S&P 500 Index sank 4.1% to erase out its January gainer and turn lower YTD. The index posted its worst day since the US lost its pristine credit rating.

This is classic risk off mode that may not end quickly.

DJIA ended the day lower by 4.6% its steepest fall since August 2011, and is now in negative territory on the year.

The Cboe Volatility Index (VIX) more than 2X to its highest mark in 2.5 years.

Treasuries jumped sending the 10-year yield down more than 10 bpts, and Gold future finished higher. The USD stabilized, and JPY advanced.

Crude Oil extended declines after US explorers raised the number of rigs drilling for Crude to the most since August. Copper climbed the most in a week.

Bitcoin slid below $7,000.

Some Key events scheduled for this week:

Monetary policy decisions are due in Australia, Russia, India, Brazil, Poland, Romania, the UK, New Zealand, Serbia, Peru and the Philippines.

Earnings season continues with reports from Bristol-Myers Squibb, Ryanair, Toyota Motor Corp., BNP Paribas, BP, General Motors, Walt Disney, SoftBank, Sanofi, Philip Morris, Total, Tesla, Rio Tinto, L’Oreal and Twitter.

Monday, the major US stock market indexes came in at: DJIA -1175.21 at 24345.75, NAS Comp -273.42 at 6967.52, S&P 500 -113.19 at 2648.94

Volume: Trade on NYSE at: 1.32-B/shares exchanged

  • NAS Comp +0.9% YTD
  • S&P 500: -0.9% YTD
  • DJIA: -1.4% YTD
  • S&P Midcap 400 Index: -2.7% YTD
  • Russell 2000: -2.9% YTD

HeffX-LTN Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance
5 February 2018 QQQ 160.82 Neutral (0.22) 159.02 161.45
5 February 2018 DIA 254.93 Bullish (0.37) 253.85 256.19
5 February 2018 SPY 275.45 Bullish (0.37) 274.61 276.46

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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