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Markets Slammed But Come Into Key Levels For Bounce

The markets are getting hammered today as the SPDR S&P 500 ETF (NYSE:SPY) are down 2.75%.  While this is a brutal sell off, the markets are all coming into the 50 moving average on the daily chart.  This is going to be significant support and a possible short term long play.  That level on the SPY is $117.05.  Look for a solid bounce here and a possible low of the day.

Technology is being crushed the most today as the NASDAQ is lower by 3.25%.  This is the biggest one day loss in months and some major stocks are taking a beating.  Microsoft Corporation (NASDAQ:MSFT) is lower by 3.25% and Apple Inc. (NASDAQ:AAPL) is down 3%.  MSFT just nailed the 50 moving average on the daily chart. This could be some support, while AAPL is still a few dollars away from the 20 moving average on the daily chart, a level of significant support.

Stocks that are attached to commodities are being beaten down as well.  Chevron Corporation (NYSE:CVX) and Exxon Mobil Corporation (NYSE:XOM) are lower 3% and 2.35% respectively.  Metal stocks are under pressure again as well.

The one area that that is not being punished harshly is the financial sector.  Goldman Sachs Group, Inc. (NYSE:GS) is higher on the day by $0.26.  By no means is that a big gain but impressive based on the losses across the market.  In addition, JPMorgan Chase & Co. (NYSE:JPM) is just down 1.70% while the rest of the market is down near 3%.  Most likely, financial stocks are looking like one of the rare safe havens in this blood bath.

The markes are getting a bounce off of the key 50 moving average support level.  Fear over Europe is increasing as everyone knows Greece was just the first shoe to drop.

Gareth Soloway
Chief Market Strategist