Commentators and talking heads of the media would have an investor believe that the 777 point decline in the Dow Jones Industrial Average was the worst one day decline on record. Well, today's decline barely cracks the top ten on a percentage basis.
Even before the House vote failure on the bailout package, the market was skeptical of this package. The Dow was down + or - 300 points before the vote results. The key here is to get a Congressional package that is the right one. The web is flush with commentary on the package so I will not restate them here.
From a technical market perspective, we are finally seeing fear in the streets. The VIX has jumped to 46. The percentage of S&P 500 stocks trading above their 50 and 150 day moving averages have reached extreme oversold levels.
From a technical market perspective, we are finally seeing fear in the streets. The VIX has jumped to 46. The percentage of S&P 500 stocks trading above their 50 and 150 day moving averages have reached extreme oversold levels.
(click on charts for larger image)
There is money to be made in this market when it turns. Investors should take this opportunity to not react hastily, but remain disciplined in their stock selection choices.
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