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Intraday Market Notes: Turkey Trotting Higher -- October 11

|Includes:TKF, Turkiye Garanti Bankasi A.S. ADR (TKGBY), TUR, XHB

4:00 pm ET: The major averages are desperately clinging to current support. A break through these closing levels would be a strong indication of further downside. The one ray of hope is that as the major averages sold off, the VIX also dropped (they typically move in opposite directions). A divergence such as this one shouldn't be ignored but the question is, how should it be interpreted?

I have to honestly say that I don't know. The fact that the Trin also dropped is encouraging but it still has plenty of room to move in either direction meaning that it, too, isn't giving us much to work with. Perhaps the market is waiting on tonight's vice presidential debate..?

Well, whatever the reason one thing that *is* clear is that some sector rotation is definitely going on. Oil and gas producers and servicers are feeling some strong buying pressure at the expense of food producers and retailers, discount retailers (DLTR, TUES, FDO), and homebuilders. In fact, the downward movement in homebuilding was presaged by the topping tail put in on October 5th by the homebuilding etf (NYSEARCA:XHB). If you're long any stocks in this industry group, now would be a smart time to take some money off the table.

In country news, two Turkey funds (TKF, TUR) are making new highs as is Turkiye Garanti Bankasi (OTCQX:TKGBY) which vaulted over 5% to put in a new high. At $4.70, this issue is an inexpensive way to buy into Turkey but please note that it is rather thinly traded (200k average daily volume) so please use limit orders if you do buy the stock (after researching it, of course!).

That's it for now. For some fun during tonight's debate, check out #drink on Twitter.

Note to Subscribers: There is one new Channeling Stock.

Stocks: TKGBY, TKF, TUR, XHB