Another Miserable Day; Maybe The Most Disheartening One Yet

It was another miserable day of selling for the market, as stocks sold off en masse after the brief rally during the New York lunch hour failed, sending the major indices to fresh lows. In a sad example of how bad things are, the S&P 500 not only fell below the lows from the last bear market, but it now is dangling at the worst level since April of 1997.

When it was all said and done, the indices closed with losses, on average, of 5.78%, on breadth that ended up just worse than 15:2 to the negative. Energy and financials were hit particularly hard, but nothing escaped the carnage today, as only consumer staples was able to close with a loss of less than 4%.

The biggest thing that the bulls have going for them right now is that today’s selling came on the biggest volume since October 10th and left the market quite oversold. The continuing flight to safety and fresh spike in the VIX really gets the contrarian juices flowing, but timing reflexive rallies can not only be difficult, but even if you can ride on the coattails of one, you’d better move to lock in gains quickly.

The bottom line is that we are seeing a period in the stock market that will be talked about for generations. Stay focused and keep that capital protected, because at some point, things will turn, and when they do, we will be in a great position to profit.