Testing June or December LOWs?

Major turmoil in the markets today.  Have you heard?  There’s a trade war going on.

As I mentioned a couple weeks ago, I’m waiting for the S&P 500 to hit its 200dma before I buy this dip.  Hasn’t happened yet, but with the seasonal volatility of August-October, I might just get my chance.

Today’s news that drove the S&P 500 down 2.59%:

  • China announced additional tariffs on US products
  • Trump “orders” companies to leave China
  • FED gives milquetoast comment about supporting economy

How low will the S&P 500 drop?  I have no idea, but it’s likely to test the June or December lows.

  • 6/3/2019:        2744
  • 12/24/2018:    2351

That’s a wide range.  For now, I think 2700-2799 is more probable.  Call it an even 2750.  That puts the peak-to-trough decline at ~10% and within 1% (below) of its 200dma.

NOTE: Emerging Markets are almost at their December lows…yet they did relatively well today, only down 1.49%.

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