SPX 1-Minute and 5-Minute Charts; S&P 500 FLASH CRASH ON 2/8/18

The S&P 500 flash crashes twice in the same week and the Dow prints two days that are down each in excess of 1,000 points. Today, Thursday, 2/8/18, during the last one-half hour of trading, stocks flash crash -2% creating a huge -3.8% down day overall.

The day plays out as follows.

Stocks are weak all morning and then deteriorate in the afternoon.

Treasury yields are; 2-year 2.12%, 5-year 2.57%, 10-year 2.85%, 30-year 3.14%.

At lunchtime, US stocks remain weak. SPX 2646. INDU 24482. COMPQ 6953. RUT 1492. VIX 29.63. Most sectors are in the red. Utilities are trying to stay positive. XLU +0.5% CLRE +0.3%.

At 12:22 PM, the SPX is down 45 points, -1.7% to 2636. The Dow is down 505 points, -2%, to 24390. The Nasdaq Composite is down 130 points, -1.8%, to 6921. The RUT is down 21 points, -1.4%, to 1487. VIX 31.53. Twitter is the bright spot in the sea of red ink today. TWTR +18%.

At 12:28 PM, SPX 2631. INDU 24354. COMPQ 6912. RUT 1485. VIX 32.05. The day is ugly. The market mood becomes ugly as the day proceeds. This year’s joyous bullish party with President Trump cheering new stock market highs day after day is long forgotten.

XLE -2.1%. One pundit after another told Ma and Pa to buy energy stocks with both hands over the last couple months. XLE has dropped from 78 to 67, -14%, in only 12 trading days. RRC is down -1.5% falling like a rock and down -60% off its record top almost two years ago. CHK -2.6%. COG -1%. GE -3.2%.

The SPX is down 56 points, -2.1%, to 1625. The Dow is down 590 points, -2.3%, to 24295. The Nasdaq Composite loses 169 points, -2.4%, to 6883. RUT 1481. TRAN -2.4%. WTIC oil 60.88. Brent oil 64.60. Natty 2.715.

Fed’s Dudley says the stock market selloff is “small potatoes.” Those are probably famous last words.

At 12:54 PM, the Dow is down 600 points.

Equities are sinking. The SPX is down 60 points to 2620. The Dow sinks 640 points to 24250. COMPQ 6871. RUT 1477. VIX 34.37.

The Dow is down 666 points, -2.7%, to 24228.

GE -3.8%. CMG -2.6%. CAT -3.8%. NVDA -3.2%. NFLX -3.8%. WHR -3.4%. UPS -1.6%. MMM -3%. GM -2.8%. DIS -6.8%. UNH -1.8%. T -2.666%. PG -1.1%. CVS -3.2%. HBI -10%. KORS -7.7%. NLSN -7.4%. GT -6.4%. IRBT -31%; the iRobot vacuum cleaner is stuck in the same spot wearing a hole in the rug.

There are a few joyous winners. NYT +15%. GRUB +20%. TWTR +21%. COTY +15%. K +3%. VIAB +7.2%. FISV +3%. CAH +2.3%. ELY +2.4%.

At 1 PM, the 30-Year Bond Auction goes off at 3.121% with soft demand.

Stocks remain weak all afternoon so the sell programs are relentless and not letting up. Volatility remains elevated and stocks remain depressed. The bottom falls out.

The SPX is down 57 points, -2.1%, to 2624. The Dow flushes 608 points lower, -2.4%, to 24292. The COMPQ collapses 165 points, -2.3%, to 6887. VIX 31.94.

Oil is down -1.3%. WTIC oil 60.98. Brent oil 64.666. Natty gas 2.69. Gold 1317. Silver 16.37. Copper 3.085. Platinum 975.

Treasury yields are; 2-year 2.13%, 5-year 2.57%, 10-year 2.85%, 30-year 3.14%. The 2-10 spread is 71.5 bips.

At 3 PM, stocks are crashing. SPX 2620. INDU 24265. COMPQ 6882. RUT 1480. VIX31.45.

Chips crash with the SOX down -4.2%. Chips are in -10% correction territory. MU -4.8%. NVDA -5%. AVGO -3.3%. XLNX -6.2%. HPQ -6.1%. Banks crash. XLF -3.666%. KRE -3.5%. XLI -3.9%. Everywhere you look stocks are bleeding.

HBI soils its underwear crashing -11%. NLSN -10%. KORS -9%. GT -8%. NFX -8%. TTWO -12%. TSLA -8.6%. Elon Musk pours a shot of booze into his café latte as Tesla lost almost one-tenth of its value in one day. ALXN -7.4%. TEVA -11%. NTES -6.3%.

The following five stocks send the Dirty Thirty over the cliff. AXP -5.6%. INTC -5.4%. CAT -5.4%. HD 0-5.3%. GE -5.2%.

The S&P 500 is down 68 points, -2.6%, to 2613. The Dow Industrials lose 720 points, -2.9%, to 24169. The Nasdaq Composite is down 188 points, -2.666%, to 6864. The Russell 2000 small caps are down 31 points, -2%, to 1477. VIX 32.76.

WTIC oil is down -2.2% to 60.44. Brent oil is down -1.9% at 64.26. Natty 2.69. Gold 1318. Silver 16.35. Copper 3.081. Platinum 974.

Treasury yields are; 2-year 2.13%, 5-year 2.56%, 10-year 2.84%, 30-year 3.13%. The 2-10 spread is 71.4 bips.

Interestingly, the bottom falls out of stocks but the yields are not moving higher. The 10-year was spanked back from the 2.79%-2.80% resistance level and has not come back up again.

Euro 1.225. Euro/yen 133.26. Dollar/yen 108.78. Pound 1.391. Euro/pound 0.8807. Indian rupee 64.26. Mexican peso 18.8425. Canadian dollar 1.26. Dollar/yuan 6.3298.

At 3:40 PM, stocks are at the lows. The SPX is down -2.8% to 2607. INDU sinks -3.1% to 24122. The COMPQ is down -3% to 6841. The RUT loses -2.1% to 1475.

Each time you look away from the computer screen, and then look back, prices are drastically lower. Equities are flash crashing into the close. The trading robots kick into high gear at 3:27 PM at SPX 2631 sending price to 2607 only 13 minutes later. The 2600 level will likely fail.

SPX 2605. INDU 24093. COMPQ 6839. RUT 1474. VIX 33.78. TRAN -3%.

At 3:43 PM, boom. The Dow is down 803 points, -3.2%, to 24087. Flash crash in progress. Indiscriminate selling is taking place. The baby, bathwater and kitchen sink are all thrown out. Margin calls create more selling pressure.

Since 3:30 PM, the TICK machine is throwing off -1000 and lower readings uber over sold). At 3:38 PM the TICK prints -1420. The negativity is off the charts. Traders are throwing stocks out the window. Indiscriminate selling.

The Dow is down 824 points, -3.3%, to 24061. The SPX sinks 80 points, -3%, to 2601. LOD 2600.33. The bulls are trying to hold the psychological 2600. Failure. At 3:51 PM, the S&P 500 loses the 2600 level to 2599.

Stocks flush lower. Trading volume is heavy about two times average but not as intense as the Tuesday flash crash at about three times average volume. There are large blocks of stocks selling into the closing bell. Prices are not recovering but instead sinking more negative into the bell.

TRAN is down 334 points, -3.2%, to 10227. The trannies are now in a -10% correction. The Dow transports and Dow Industrials are making lower lows forecasting more trouble from a Dow Theory perspective. The upside joy for many months is long forgotten. The trannies join the utilities in the -10% correction territory off the record tops. Ditto AAPL down -1.6% today. MSFT, AMZN, GOOGL, FB and NFLX are all down -10% off their record tops in correction territory.

The television pundits told Joe Sixpack, Ma and Pa Kettle, Aunt Mary and Timmy Tech to buy the stock market with both hands. They did and now they receive their heads on a platter. Aunt Mary listened to the nice guy on television and placed her entire life saving in the stock market on 1/23/18; tonight she is eating cat food for dinner wondering what to do.

Stocks wash-out into the bell. It is nasty. The bulls are running for their lives locking in profits and wanting to steer clear of the stock market.

Two minutes before the close, the Dow loses the psychological 24K level to 23957 and dropping like a rock. The Dow topped out at 26615 on 1/26/18. LOD 23849. The Dow has lost 2766 points in nine days, -10.4%. The Dow is in correction territory. This is the worst week for the Dow since October 2008.

The S&P 500 has lost %2.2 trillion in value in the last nine days. The high-flyers such as AMZN, AAPL, MSFT, BRKA and XOM have each lost between $50 billion and 70 billion in market cap. These five alone account for a loss of $300 billion in market value. Lots of novice investors ran into these stocks with their Christmas money and are only left with coal in their stocking.

Traders are relieved that the closing bell finally rings. There is carnage and blood on the trading floors. For the last 25 minutes, the TICK machine is pegged at from -1000 to -1400 so this uber negativity hints that a relief bounce should be on tap for stocks. A -1400 TICK indicates nearly every stock was thrown out the window in a mini panic.

The stock market flash crashes for the second time this week. In the last 32 minutes of trading, the S&P 500 falls 50 points, -1.9%. That is a flash crash in the final half hour.

At 4 PM EST, US stocks are bludgeoned and bloodied beyond recognition. The SPX drops 101 points, -3.8%, to 2581. That beating is going to leave a mark. The S&P 500 finishes smack-dab on the 150-day MA at 2580. LOD 2580.56. This is the big test. Price will bounce or die from this 2580-2581 level tomorrow. The decision will be epic. The SPX lost the 20-week MA at 2651.

The Dow plummets 1033 points, -4.2%, to 23860. LOD 23849. The 100-day MA support/resistance is at 24076. The 20-week MA at 24227 is lost.

The Nasdaq Composite finishes down 275 points, -3.9%, to 6777. The 100-day MA at 6856 is lost. The 150-day MA is at 6683. The 20-week MA at 6898 is lost. NDX -4.2%. TRAN -3.8%. SOX -4%. XLF -4.4%. What an ugly day. Hide the women and children from such a gruesome sight.

The RUT loses a stunning 44 points, -2.9%, to 1463 under the 150-day MA at 1483. The Russell 2000 stops directly at the 200-day MA at 1462. Like the S&P 500 above, the RUT will bounce or die from this critical support level at 1462-1463 and take the broad market with it.

The pivots from the SPX and RUT moving average support levels are key at tomorrow’s opening bell. The RUT 50-week MA is at 1449. If RUT loses the 200-day at 1462 tomorrow, price will seek that 50-week at 1449 for a test at that level. VIX 33.46. VIX HOD 36.17. The VIX printed at 50 during the Tuesday flash crash so for this event, stock prices print lower lows but the VIX does not print a higher high.

It will take a couple hours for the smoke to clear. Traders are filling the Manhattan bars comparing notes on the historic selloff and epic nine trading days that have sent major indexes into immediate -10% and lower correction modes. AAPL is down -14% off the record top. Uncle Frank bragged all of January about buying and owning Apple stock but he does not mention it anymore.

After the closing bell, AIG sinks -5% on earnings but a short time later is up +1%. ATVI +3.7%. BECN beats on earnings. EXPE crashes -15%. FEYE rallies +13%. MTW flat. MOBL sky rockets +19%. Flooring king and housing sector bellwether MHK beats on earnings but misses on the top line. NCR +0.7%. Chip darling NVDA rallies +5% on earnings and stronger guidance. NUAN +3%. SKX +4.8%. ZG crashes -7.5%.

Qualcomm rejects the takeover offer from Broadcom but talks will continue. AVGO +0.4%. QCOM +1.5%.

The Senate spending bill that needs passed by midnight to avert a shutdown hits a snag in the House. The rumors exacerbated the stock market selloff to a small extent. Conservative members in the House do not want to raise the government debt although they are in favor of military spending. The vote on the bill was supposed to take place today but it is delayed. The midnight deadline is approaching. Tick, tock.

The lawmakers should pass the bill this evening but there are worries that a partial government shutdown will occur again. The politicians are incompetent. The republicans and democrats both want to spend money on their pet concerns. There is no fiscal restraint. The budget office verifies the big increases to the debt if the bill is passed.

If the bill is passed to avert the midnight government shutdown, the democrats receive money for domestic giveaways and the republicans receive money for the military. Fiscal responsibility is spit on. The Tea Party is dead although conservatives voice concern over the big increase in debt. The politicians spend, spend, spend. The bread and circus days continue.This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

(above excerpt is from Keystone the Scribe)