11/18 Bearish. 180 Buying | 650 Selling.
% Stocks Over 50SMA is Bearish. Primary Indicator is Bearish. 20% Weekly is Bearish – Extreme Caution.
The market closed below key 50-day moving averages for the first time since April, signaling a clear shift to bearish momentum amid broad sector weakness and rising volatility (VIX +14.3%). Chipmakers and financials led the declines, pressured by fading AI enthusiasm and downgrades, while defensive communication services and utilities saw modest gains. Fed speakers expressed cautious optimism on rate cuts, but uncertainty remains high ahead of upcoming major earnings and economic data.
Sector-wise, financials and semiconductors were the weakest, with the S&P 500 financial sector down nearly 2% and the semiconductor index off 1.6%. Communication services bucked the trend, led by Alphabet’s strong gain after Berkshire Hathaway’s stake disclosure. The surge in VIX implies elevated risk and potential for continued choppiness.
Tomorrow’s key catalysts include October Industrial Production and Capacity Utilization data, November NAHB Housing Market Index, and Fed Governor Barr’s remarks on bank supervision. Early earnings from AMRK, BRC, JJSF, and JKS will also provide directional cues.
Key Takeaway:
Traders should remain cautious and favor defensive or selective names amid broad market weakness and elevated volatility. Focus on well-defined support levels and avoid chasing breakouts in weak sectors. Watch for volume-supported dips in momentum biotech and communication services stocks, which show relative strength. Tight stops and reduced position sizes are advised given the extreme bearish sentiment and sector divergences.
Watchlist
Continuation: MCRB (S1: 20.5, S2: 19.5, S3: 18.5, R1: 21.5, R2: 22.5, R3: 24)
Anticipation: KALV (S1: 14.5, S2: 14.5, S3: 14.0, R1: 15.0, R2: 15.5, R3: 16.0)