The market collapsed once again this morning, leaving the S&P 500 down nearly 5% on the week at one point. We’ll be covering this week’s drop in our Bespoke Report newsletter due out later today, but below we just wanted to provide you with trading range charts of the S&P 500 and its ten sectors. For each chart below, the white line represents the sector’s 50-day moving average. The light blue shading represents the sector’s “normal” trading range, which is one standard deviation above and below the 50-DMA. The green zone represents oversold territory, with the bottom end of the green zone two standard deviations below the 50-DMA.
As shown below, the S&P 500 is now far below the bottom of the green zone, meaning it’s in extreme oversold territory. Notably, the index is still above its lows from earlier this year, and it’s at a key support level as we type this.
Have a look at our trading range charts for the ten S&P 500 sectors below. There’s been lots and lots of pain this week, with further breakdowns in Materials, Energy and Industrials. Technology and Health Care are both on the verge of new breakdowns, while Consumer Discretionary is at the very bottom of the range it has been in for the last six months.
Again, we’ll have full coverage of this week’s decline in our newsletter due out later today, with key insights into what it means for the market going forward. To receive it in your inbox, sign up for a 5-day free trial to any of our subscription services.