The selling continued on Wall Street today, as the Dow Jones Industrial Average (DJI) notched a second straight session below its 200-day moving average and its worst settlement since July 25. "We saw early buyers come to the table after yesterday's big sell off, but the downward momentum just couldn't be halted, and we once again found ourselves in negative territory," remarked Schaeffer's Senior Equity Analyst Joe Bell. "The initial jobless claims number was lower than expected, but most attributed this to Hurricane Sandy creating a tough situation for people to make unemployment claims. Though economic news was light, we still had a slew of earnings reports that were mixed."
Early-session hopes of a rebound from yesterday's selloff were quickly dashed this morning, as stocks dipped into negative territory. Today's selling -- while not nearly as feverish as Tuesday's -- continued throughout the afternoon, bringing the Dow Jones Industrial Average (DJIA) to rest about 0.9% lower on the day, just off its intraday nadir.
Meanwhile, technicians were focused on the 200-day moving average on the S&P 500 Index (SPX). This trendline has supported all but a handful of daily closes in 2012 and had not been breached -- even on an intraday basis -- since early June. As the closing bell sounded, the SPX was off 1.2%, well south of the 1,400 level, and a hair below this significant trendline. The Nasdaq Composite (COMP), meanwhile, brought up the rear with a loss of 1.4%, and its lowest close since late July.
Finally, in a strange turn of events, the CBOE Market Volatility Index (VIX) moved lower, despite the continued declines in the broad market. The index was in negative territory throughout the day and closed off roughly 3%, settling back below the $19 region.
Today's highlight: "If you are looking for a glimmer of hope, I guess you can hang your hat on the fact that the market slowed its losses down just a little bit today," said Bell. "After being down more than 300 points on Wednesday, a decline of around 120 points may seem like a small victory for some. While price action has not been great, more and more focus will continue to move toward the uncertainty surrounding the 'fiscal cliff.'"
More of today's big stories:
And, in case you missed it ... Schaeffer's Senior Technical Strategist Ryan Detrick discussed the average true range (ATR) and what it says about the potential for more selling on Wall Street.
For today's activity in commodities, options, and more, head to page 2.
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