This is the kind of reversal that happens in a bull market.
The markets will continue to be volatile as global economic data shows bearish signs into the start of the new year.
Market action today is about positioning and portfolio adjustments for 2019.
Which way the market will go is anyone's guess.
But extreme short-term volatility will produce extreme long-term loss of public trust.
And how to position your portfolio to minimize the impact.
The Fed now appears to me, to be if not in the 'policy error' zone than very close to it. Perhaps the Treasury Secretary sees this as well.
If this train wreck happens, it could combine the worst elements of the last four stock market crashes.
Smaller stocks had outperformed large-caps for much of 2018, but now find themselves down for the year to date after a tough couple months.
It is the sort of negativity that produces capitulation.
One way to generate stable income and protect against rising interest rates is through a bond ladder.
There have been some solid earnings reports, but they haven't provided a boost to the broader market.
The biggest risk right now is the yuan level versus the dollar.
The Federal Reserve should, but likely won't, stop hiking rates before it inflicts more economic damage.
The other involves taking advantage of late-day rebalancing by ETFs.
Big-picture concerns are intensifying selling pressure, which favors bargain hunters in search of individual stocks.
After recent liquidation, it seems the risk-reward is on the downside for the dollar and U.S. bonds.
The analysis of time clusters is a key ingredient in anticipating when to make a trade.
I have geared my Transports allocation toward the rails this year.
The Dow Industrials in particular produced a solid spurt higher, but the average stock has underperformed the indices.
The market is anticipating higher rates and some inflation and that likely will matter at some point, but not yet.
I am sick and tired of reading stories about how buybacks inflate earnings and are, therefore, phony.
Apply the lessons of that boring trading year to today's market.
The Chinese government could intervene to support its markets, but the charts suggests China's key stock index could decline further near term.
Analyst downgrades and mind-boggling P/E ratios do not matter in this current market.
The 2-year Treasury yield, TIPS and gold all indicate the Fed shouldn't be forced to put a clamp on inflation.
There's too much evidence of economic strength, so don't interpret these moves as a sign of a real slowdown.
Here's what the charts say on the beaten-down group.
There's a a buy setup in XLE and then a secondary entry in JPM.
Rather than an outright short on commodities, consider a spread bet between long energy and short base metals.