ChartSmarter Thursday Game Plan 10/27/16

Markets were lower for a second straight day Wednesday with the Nasdaq taking the brunt of the selling down .6% finishing right at its 50 day SMA. The S&P 500 fell .2% and has now lost ground 4 of the last 5 days and has now been below its 50 day SMA for the better part of 7 weeks and the longer this lingers the more bearish it becomes. The Russell 2000 did undercut the 1210 number today, losing a hefty .9% and taking out a double bottom to the downside and this index has a pulse of the risk thermometer of investors. We have been talking a bit about the amount of bears out there but lets keep in mind their seems to be an overwhelming majority of folks that are positioning themselves for a year end rally. Sure October is almost in the record books, but maybe the year push may be much less amplified than many anticipate. Sectors that were affected the most today were real estate, healthcare and tech. The XLV is already down 8 of the last 11 weeks and thus far this week has given up 1.1%. The ETF is now on a 4 session losing streak and advanced just 5 days in all of October so far. When it lost its 200 day SMA earlier this month it also took out a bearish head and shoulders formation in the process. BIIB had issues with the round 300 figure after reporting numbers this morning and others much more negatively impacted were EW and LH to name a few with both slicing through their 200 day SMAs in gigantic trade. Financials were among the winning groups Wednesday and the XLF is now flirting once again with the round 20 number. It has recorded just 4 CLOSES above 20, all last November and December (it traded to 20.01 on 9/1-2 this year but no finishes above). Below is the chart of SYF and how it appeared in this Mondays Game Plan. Todays marks the fourth straight CLOSE above the 200 day SMA which we find is a good rule to follow to ensure the move is legitimate.