BLK Blackrock Weekly Chart Saudi's Exiting Funds

A contributing factor to the large broad market selloff yesterday, that went somewhat under the radar screen except for professional traders, is the Saudi's moving money out of money management funds such as Blackrock. The drop in oil prices hurts the Saudi Arabia economy since it is almost universally dependent on oil income. The Saudi's are pulling money from hedge funds and other investment funds to keep supporting the country's social programs.

As firms like BLK watch the outflows taking place, concern grows that opportunities will be more limited. Traders were already sniffing this out this year as BLK topped in the spring time and rolled over from 380 down to sub 3 hundo. The support at 290-ish is very strong; if it fails Backrock will fall down the rabbit hole. The brown lines show a head and shoulders (H&S) vibe with head at 380 and neck line at 290-ish. If 290 fails, price will target 200.

The MACD line is sloping negatively with the RSI, histogram, stochastics and money flow sloping positively over the last month. The green lines are not positive divergence as yet, however, since price has to print a lower low to create the divergence. BLK was far above the moving averages and is now performing a mean reversion lower and the 200-week MA at 263 and rising is an attractive downside target.

The projection would be for BLK to come down to test the trend line support at 290-ish for a bounce or die decision. The indicators would be positively diverged with the lower low in price so a bounce would be in order for a week or three but the weak and bleak MACD line will want price to come down for another low say in October or November. So BLK should stagger through 260-320 into the end of the year. Most important is how much money do the Saudi's plan on withdrawing from US hedge and investment funds? 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.

Note Added 10 PM EST: BLK drops -0.2% to 293.52. BX (Blackstone) drops -2.7% adding to the ongoing huge losses. BX was 43 only 4 months ago now at 30 about -30%.