The market declined 4.1% last week. Wednesday saw the biggest one day drop since February. Volatility spike higher and remained high into Thursday and Friday. Will strong earnings and a normal economic calendar be enough to squash the volatility and begin a rebound.
This week many will be talking about the major drop we had last week and what will keep the market from moving further down. The120 daymoving average was broken. The longer the market stays below this line, the more I am worried. Support at 2700 held, but with such momentum we could see a break below.
Most pundits agree that interest rates rising is a possible cause of the market readjusting to a new interest rate level.
I am not sure if blood is in the street, but there was a fight between the bulls and the bears. There is extreme fear in the market right now. A contrary investor might say it is time to put some money to work.
Global Spotlight
A Critical Brexit Summit. Next week will be key for the Brexit process when leaders from the United Kingdom and the European Union meet in Brussels on Oct. 17, followed by a European Council meeting on Oct. 18.
To Call Out China or Not — That Is the Question. The U.S. Treasury Department’s semiannual report on the currency policies of the United States’ trading partners is expected any day and all eyes are on whether the report will declare China a currency manipulator.
The Five Eyes Turn Their Attention to China. The Five Eyes alliance — an intelligence-sharing network that includes Australia, Canada, New Zealand, the United Kingdom and the United States — has been expanding its cooperation with other countries to try to counter China’s growing cyber-related threats.
Pastor’s Release Signals Calming Tensions Between Turkey and the U.S. Turkey released American pastor Andrew Brunson from custody Oct. 12 after he served more than two years in prison on terrorism-linked charges.
Stratfor.com
Economic Calendar
Here isa a list of the U.S. economic events happening this week.
Briefing.com
Review Last weeks numbers here.
Earnings
Thomson Reuters I/B/E/S
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