Though Monday was uneventful this week, by Tuesday the markets were in full sell off mode. The markets had their worst day of the year so far and their worst day in over six months. The liberal media here in the states attributed the selloff to concerns about Trumps agenda but the conservative media focused on weak fundamentals in the markets. This just proves that everyone was guessing and its as simple as the sellers were more powerful than the buyers.
The S&P 500 (NYSE: SPY) sold off 1.28% on Tuesday breaking all short term support in addition to the uptrend. The SPY has been in a consistent uptrend since November but that all ended Tuesday. To be fair the SPY is still up over 4% this year but Tuesday showed some real concern from the bulls for sure.
The Nasdaq 100 (NASDAQ: QQQ) sold off harder than the S&P 500, losing 1.52% on Tuesday alone. Remember that the Nasdaq has been slightly stronger than the rest of the indices so it is quite possible that traders were more heavily allocated to the tech index. For the year the Nasdaq 100 is still up a healthy 9%.
Getting some attention from the bulls this week is bonds (NYSE: TLT). Last week traders were calling the end for bond prices as the Fed raised rates but this week the TLT is up another 1.4%, recovering sharply from the lows of the year. Make no mistake, the TLT is still quite weak, but with the market pullback on Tuesday investors had to run somewhere and bonds was one of those sectors.
Another sector that investors ran to was Gold (NYSE: GLD) which is common during sharp moves lower in the markets. The GLD is higher by 1.37% this week and continues to show short term strength. Its clear now that the pullback two weeks ago was in fact a buying opportunity and many investors are showing that they still want to dive into precious metals.