My guess is that if the US dollar doesn’t show some strength, the Mexican peso will. The USD/Peso has dropped below the 200-day moving average on a number of occasions recently. Most of those times it has been brief, however, we now seem to be living beneath that moving average line. Quite frankly, we need a much stronger dollar in order to change things. I’m not very hopeful that this will happen, though the dollar does seem to be trying to put in a base.
The stock market tried to extend its rally today, but, it was just a relief rally with the markets down across the board fairly substantially. The Dow Jones and S&P 500 didn’t rally nearly as much as the tech stocks from the February lows. In fact the Dow Jones put in a new closing low on the most recent 1100+ decline. What now has me worried is that the tech stocks are very close to breaking support, this could really create some damage.
Let’s take a look at the tech sectors that have me worried.
You can see that both of these indexes are on the verge of breaking down. These indexes have really been supporting the market’s advance. We have already seen some cracks in the armor. Let’s first look at Google (Alphabet) and Facebook.
You might say that these are just social media stocks that have been having a tough time. Granted that may be correct. However, take a look at the next two on my list, Amazon, and Netflix.
I think that you will understand my concerns. Perhaps, we just need to see the strongest stocks get taken to the woodshed before this all ends? I guess we will find out this week.