Fed Chair Powell’s press conference yesterday sparked a pretty large drop for US equities.  The S&P 500 finished the day lower by more than 1%, and as shown below, most of the index ETFs that we monitor were pulled back into neutral territory from overbought levels.  For now this can be characterized as simple mean reversion.

Looking at sectors, Financials and Communication Services are the only remaining ones in overbought territory, while Utilities and Health Care are the only two that have dropped below their 50-day moving averages.

International equities are in much worse shape given that many of the country ETFs we follow are now below their 50-day moving averages or outright oversold.  Spain (EWP), Mexico (EWW), Norway (NORW), and India (PIN) are actually in extreme oversold territory after sharp moves lower over the past week.  Start a two-week free trial to Bespoke Premium to receive our best equity research on a daily basis.

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