Well it looks like the market got a stomach ache from the candy it got from Halloween when it stopped by Bernanke’s house! All kidding aside the market got hammered to put it bluntly. With the Dow, NASDAQ , and S&P selling off 362, 64 and 41 points respectively. Which leaves the market poised for an interesting and critical day tomorrow. Both the Dow and S&P are nearing support levels, with the Dow at 13,500 and the S&P at 1500. It will be important that the market holds these levels to continue its current upward trend. The NASDAQ on the other hand is about 100 points off from major resistance levels at 2700. So keep an eye on these marks. If it closes below them, we will have to consider a more conservative approach until the market finds its footing.
However, after the bell today, the Fed pumped in $41B into the U.S. Financial System. Depending on how the market views the news it could help the overall market rebound tomorrow. If we do gap down tomorrow, our QLD (ETF) recommendation could provide a solid return if the market thereafter recovers.
But overall today, the market really didn’t sell off on any other major news besides what was discussed in yesterday’s market summary – namely the possible end to the interest rate cuts and a slowing economy.