All major equity indices are now showing Algo Engine sell conditions. The NASDAQ has led the charge higher and the FANG stocks in particular, have outperformed.
Overnight the Dow fell 460 points and the NASDAQ was down 2.5%.
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Bank stocks have been trending lower this week, as an inversion of the yield curve, (the spread between the 3-month treasury bill yield and the 10-year note rate), turned negative for the first time since 2007.
Fears of a recession are building as we see a continuation of weak economic data from around the world.
Technically, we suggest investors overlay the 10 day average on the NASDAQ and remain defensive, as long as the index trades below the average.
