Powell Speak Triggers 2+ Std Dev Move in SPX...FOMC Press Conference Sinks Stocks Again after Rate Cut to Protect Economic Growth...

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FOMC Chairman Powell continues to be his own worst enemy.  He again failed to communicate in today’s press conference that the action being taken by the Fed was the correct action and that financial markets should be confident with the action taken.  Instead markets panicked as he answered questions and the SPX fell 50 points and the Dow shed 443 points in less than 20 minutes.

As Fed Chairman he has a responsibility to enact policy and communicate it in a way that correctly articulates the policy action that the Fed is taking and why market participants can be confident that it is the right action at the specific time it is announced.  If he can’t inspire confidence in Fed actions under his leadership, who will?

The disappointing part of today’s action is that the economy is a good as it was on Friday when the DJI and SPX hit new all-time highs and the economy received today a protective inoculation with the rate cut to help prevent economic slowdown.  Good news resulting in the sharpest intraday selloff in 2019.

Powell’s ineffective use of language in answers to questions was the catalyst for today’s market action, not the policy action itself.

The DJIA, closed down 333 points at 26,864, led by weakness in BA, UNH, MSFT, HD and V.  Closing below 27,000 for the first time since July 15. 

All eleven sectors were lower on Wednesday. 

SPY down 3.29 at 297.43 on 104.2 million shares, 84% above average volume.  Down on higher volume.

VIX up 2.18 at 16.12

Oil down .45 at 57.89

TLT up 1.06 at 132.89 on 15.7 million shares. 

AAPL +2.04%, JPM +0.35%, led the DJIA, 4 advancers, -6

JWN +7.89%, EIX +6.08% and MCO +5.98%, led the SPX.

AMGN +5.74%, EA +4.44%, ALGN +2.87% and FISV +1.46% led the NDX.

Long term up trend intact.  3-day short term trend is down.

Up:

Down: IWM, SPY, DIA, QQQ,

Breadth weakened on Wednesday, as decliners led 1,893 to 1,068 on the NYSE and led 2,116 to 998 on the NASDAQ

The SPY MFC green line is pointed down in the upper zone at 87 and is counter-trend defensive. 

Uptrend sectors: XLP, XLY, XLK, XLC, XLF, XLI, XLB, XLRE, XLU, XLV,

Neutral sectors:  XLE,

Down trend sectors:

The 6-month intermediate trend is up.  The ten-day trend is up.

3-month Intermediate Term Market Trend: Up

3-day Short Term Market Trend: Down

13 of 100 NDX stocks closed higher on Wednesday.

45 NDX stocks are above their 30 DMA:  CTAS, IDXX, TTWO, WLTW, COST, HAS, SBUX, FISV, INTU, ROST, CTSH, AAPL, ADI, CDNS, INTC, UAL, LULU, SIRI, AMAT, ASML, AVGO, KLAC, MCHP, NVDA, SWKS, TXN, WDC, CTRP, MU, FOXA, VRSK, GOOGL, LRCX, TMUS, JBHT, NXPI, EBAY, KHC, BIIB, ATVI,  MYL, INCY, TSLA, ADP, AMGN,

NDX Stocks to Watch on Thursday:

Moving Above 30 DMA = 2

ADP, AMGN,

Moving Below 30 DMA = 20

ADBE, AMD, BKNG, CERN, CMCSA, EXPE, FAST, FB, ISRG, MAR, MELI, MNST, MSFT, MXIM, PAYX, REGN, SNPS, WBA, WYNN, XLNX,

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