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CI Market Dashboard: Bears Take Step Back Ahead of Presidential Election

Weekly Market Summary

The Dow Jones Industrial Average (DJIA) fell for the seventh straight session on Friday and ended the week down 1.5% at 17,888.28. This is the longest losing streak for the blue-chip index since August. For October, the index lost 0.9%. This week, the index broke out of the trading range it had been in for the last couple of months to the downside. It also broke through round-number support at 18,000. It is now closing in on the 200-day moving average, which is currently at 17,767.88. First, though, we look for round-number support at 17,800. Then comes the 200-day moving average.

The S&P 500 Index (SPX) notched its ninth straight losing session to close the week, its longest such streak since December 1980. For the month of October, the index fell 1.9%. For the week, the large-cap index surrendered 1.9% and closed at 2,085.18. After breaking through round-number support at 2,100, the index may have found near-term support with the 200-day moving average (2,083.18).

According to the Select Sector SPDRs website, all 11 of the S&P Sector SPDRs ended the week in the red. Materials (XLB) posted the smallest loss, down 0.71% while technology (XLK) fell 2.66% as the biggest weekly loser

The broad market Wilshire 5000 (W5000) slid 2.11% for the week and closed at 21,594.28. The index broke through round-number support at 22,000 and tested its 200-day moving average at 21,542.11. We look to the moving average for initial support, followed by round-number support at 21,500.

The tech-laden Nasdaq Composite (COMP) also posted its ninth consecutive loss, its longest losing streak since May 1984, according to Schaeffer’s Investment Research. The index gave up 2.3% in October. For the week, the index dropped 2.8% to 5,046.37. We look for support at the key psychological barrier of 5,000. Below that is the 200-day moving average, currently at 4,941.06.

The Russell 2000 (RUT) index of small stocks bucked the overall downward trend in the market on Friday, adding 0.57%. For the week, however, the index gave up 2.04% to close at 1,163.44. The index is nearing its 200-day moving average (1,150.39) and we look to it for initial downside support.

The CBOE Volatility Index (VIX) recorded its record ninth straight daily advance on Friday. The index added 28.4% in October. For the week, the “fear gauge” jumped 39%.

Computerized Investing Market Dashboard Indicators

This week, one of the Market Dashboard indicators triggered a new signal, switching to neutral from bearish. However, no indicators generated confirming bullish or bearish signals this week.

To see the current signals of all nine dashboard indicators, visit the CI Market Dashboard.

The Market Dashboard is one of the many benefits of Computerized Investing, a service from AAII that harnesses the power of technology to help individual investors become more effective managers of their own portfolios. To learn more about Computerized Investing, visit http://www.aaii.com/computerized-investing/about.

 

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