Sellers Take Charge the First Trading Day of the Month
The equity markets are trading lower following the release of the ISM Index. The ISM index fell to 49.5, which is the lowest reading since April 2003. Dropping below 50 indicates a reduction in manufacturing.
The mid-morning RSI readings from the CQG Custom QuoteBoard, using 15-minute bars for the equity derivative products indicate selling in the E-mini S&P (EPZ6) and the DJ Euro STOXX 50 (DSXZ6). The fact that the RSI for the NASDAQ 100 (ENQZ6) is weak is a negative. The RSI for the Dow (DJI) is neutral.
Both the Q.NYSEVolRatio and the Q.NASDAQVolRatio are indicating wide spread selling as the down-volume is dominating.
The ETF7, ICE WTI Light Sweet Crude Oil for January, is trading flat
The RSI for Gold (GCZ6) and the MACD action are flashing neutral readings.
Yields are falling in the Treasury market today.
The EUR/USD pair is trading higher.
The chart of the S&P 500 and the NYSE volume ratio on a 15-minute basis are indicating selling. Notice that over the last two days, as the price rallied, the NYSE Volume ratio diverged (blue trend line). The volume ratio indicated a narrowing of breadth as the price moved higher, and forewarned of a possible turn down if any negative news came out.
The NASDAQ 100 and the NASDAQ volume ratio readings on a 15-minute basis are also indicating selling this morning. Here, too, the volume ratio was diverging with the rising prices, indicating less equities were participating during the advance. All that was needed was a catalyst to turn the market down.