stocks are in pullback territory down 6.4% to 9.3% since may 2nd

8/6/2019 Stocks are in Pullback Territory down 6.4% to 9.3% since May 2nd

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Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com. ValuEngine is a fundamentally-based quant research firm in Newtown, PA. ValuEnginecovers over 7,000 stocks every day.

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June 9, 2011 – Stock s are in Pul lback Terr i tor y dow n 6.4% t o 9.3% since May 2 nd

Housing and regional banks are leading the downside with the Housing Sector Index (HGX)

down 12.6% since February 18

th

and below its 200-day simple moving average at $106.62. TheRegional Banking Index (BKX) is down 17.0% since February 15th and below its 200-day simplemoving average at $49.79. If stocks reach this correction status the risk is to their the 200-daysimple moving averages at 11,667 Dow Industrial Average, 1251.2 S&P 500, 2623 NASDAQ,2211 NDX, 5011 Dow Transports, 766.85 Russell 2000 and 406.86 SOX. The SOX is closest tothis important test. Weak housing and the troubled banking system are Fed concerns.

Fed Chief Ben Bernanke Shares My Concerns about the Housing Market - Here’s the key excerpfrom his speech Tuesday evening as the stock market was closing. This statement sounds similar tothe comments I have been saying for nearly five years.

Virtually all segments of the construction industry remain troubled. In the residential sector, low home

prices and mortgage rates imply that housing is quite affordable by historical standards; yet, with underwriting standards for home mortgages having tightened considerably, many potential homebuyers are unable to qualify for loans. Uncertainties about job prospects and the future course ohouse prices have also deterred potential buyers. Given these constraints on the demand for housingand with a large inventory of vacant and foreclosed properties overhanging the market, construction onew single-family homes has remained at very low levels, and house prices have continued to fall.The housing sector typically plays an important role in economic recoveries; the depressed state of housing in the United States is a big reason that the current recovery is less vigorous than we would like.

The Fed’s Beige Book was similar to Bernanke’s speech - Residential construction and real estatecontinued to show widespread weakness, except in the rental segment, where market conditions havestrengthened and construction activity and development have picked up. Non-residential real estate leasing markets have been generally stable, while construction activity has remained very subdued.

Residential real estate sales markets showed continued weakness in most Districts, while rental markets strengthened. Most Districts indicate that home prices have declined since the last report. Nodistrict indicates a general increase in home prices. In terms of residential construction, activity has remained generally depressed, with a number of Districts reporting a large overhang of distressed properties.



10-Year Note – (2.951) The 200-day simple moving average is 3.102 with a daily pivot at 2.940, andweekly risky level at 2.779.

Courtesy of Thomson / Reuters

Comex Gold – ($1538.0) My quarterly and daily pivots are $1523.7 with daily, weekly and monthlyrisky levels at $1558.0, $1563.2 and $1574.3.




Nymex Crude Oil – ($100.98) My weekly value level is $94.48 with my annual pivots at $99.91 and$101.92, and semiannual risky level at $107.14.


The Euro – (1.4457) Weekly, quarterly and monthly value levels are 1.4421, 1.4308 and 1.4258 withmy semiannual pivot at 1.4624, and daily and semiannual risky levels at 1.4873 and 1.4989.




Daily Dow: (12,049) My annual value level is 11,491 with the 200-day simple moving average at11,667, a daily pivot at 12,033, and weekly risky level at 12,542.


S&P 500 – (1279.6) My annual value level is 1210.7 with the 200-day simple moving average at1251.24, a daily pivot at 1281.9, and weekly and monthly risky levels at 1330.3, and 1439.8.

NASDAQ – (2675) My annual value level is 2335 with the 200-day simple moving average at 2623, adaily pivot at 2698, and weekly and monthly risky levels at 2815 and 3068.

NASDAQ 100 (NDX) – (2253) My semiannual value level is 1927.6 with the 200-day simple movingaverage at 2211, and daily, weekly and monthly risky levels at 2274, 2373 and 2575.

Dow Transports – (5088) My semiannual value level is 4264 with the 200-day simple moving averageat 5011, a daily pivot at 5076, my annual pivot at 5179, and weekly risky level at 5493.

Russell 2000 – (788.05) My annual value level is 784.16 with the 200-day simple moving average at766.85, daily pivot at 792.19, and weekly, and monthly risky levels at 825.00, and 929.22.

The SOX – (408.94) My annual value level is 270.98 with the 200-day simple moving average at406.86, and daily, weekly, and quarterly risky levels at 415.04, 425.93, and 498.75.



Pullback / Correction Statistics – A bear market begins with a pullback of 5% to 7%, then weaknessstretches to a correction of 10%, and finally to a bear market at a decline of 20%.

Definition of MOJO – This is my term for technical momentum. I use what’s called “12x3x3 slowstochastic readings” from daily, weekly and monthly charts. The scale is zero to 10.0 where above 8.0is overbought and below 2.0 is oversold.

Richard SuttmeierChief Market StrategistValuEngine.com(800) 381-5576

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As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.comI have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters awell as my most up-to-date analysis of world markets. My newest products include a weekly ETF newsletter as well as the

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“I Hold No Positions in the Stocks I Cover.”

stocks are in pullback territory down 6.4% to 9.3% since may 2nd

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