ChartSmarter Monday Game Plan 11/15/15

Markets were hammered this week with the Nasdaq losing ground everyday this week and the last 3 sessions all CLOSING bearishly on lows for the day. It is now 6% from recent all time highs and the benchmark fell 4.3% for the week, but is still higher by 4.1% YTD with six weeks left in 2015. That was its second worst weekly loss behind the 6.8% drop the week ending 8/21. The S&P 500 lost 3.6% this week and fell back underwater for its YTD performance now down 1.7%. It is quickly approaching the round 2000 handle which was support dating back to the months of December ’14 through February of this year. The Dow which we rarely follow is now lower by 3.1% and traditionally this could point to more trouble ahead as investors tend to hold these dearest, with their “safety” and dividends, and are the last to fall before real selling could set in. Further evidence is the weakness in the small caps with the Russell 2000 now down 4.8% YTD. This could be a signal that the dollar strength will continue as it impacts smaller domestic names that are affected more by the greenback. It could also portend to more deflationary pressures as commodities trade in an inverse fashion to the dollar. Retail has continued to its thrashing and many will point out the laggards like FOSL down 72% from recent 52 week highs, or VRA down by 55%, GPS down by 43%, but the leaders now have been getting smacked down. Names like NKE fell 7.5% this week, RH by 10% and LB by 6%. Retail is a giant part of GDP and perhaps the holiday season will not be as sanguine as many believe. We do understand this is supposed to be a warmer winter, so perhaps board meetings are being called to come up with a more clever answer than the frigid temperatures affected sales. For those who think its just mall traffic with brick and mortar ailing, one would have listened carefully to JWN earnings call, where it said sales across the board and online sales were soft, not just in stores. Below is a chart of a former best of breed name UA which we examined in this past Wednesdays Game Plan.