It’s a much different picture for the equity market this morning than it was yesterday,  with futures indicating a sharply higher open.  Just to reiterate our point from yesterday, though, we continue to expect violent moves both up and down throughout the trading day.  On a positive note, JPMorgan, Citi, and Wells Fargo are all currently trading up on earnings.  Hopefully, that initial positive reaction can hold.

After yesterday’s big decline, the S&P 500 closed 3.77 standard deviations below its 50-DMA, which is the most oversold reading for the index since August 2015!  As shown in the chart below, occurrences of the S&P 500 trading 3.5 standard deviations or more below its 50-DMA are few and far between in the index’s history.  Since 1928, there have only been 18 such occurrences.

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