Stocks Slide to Start Week

January 31, 2017 3:44AM CST

After some weakness during Monday’s trading session, stocks are once again lower heading into the open today.  Many have pointed to President Trump’s recent steps to put a hold on allowing immigrants from Libya, Iraq, Iran, Syria, Yemen, Sudan, and Somalia into the US, and the uncertainty surrounding its impact as a reason for the selloff.  While there certainly may be something there, we were also trading at all-time highs with several technical indicators registering overbought readings.  The FOMC is beginning another two day meeting today with an announcement on Wednesday afternoon, but most don’t expect too many fireworks this time around.  However, we may get some Friday morning depending on how the Non-farm Payroll Report comes out.

The better part of December and January saw the S&P chopping around from about 2255-2270.  We’re retesting the upper end of that range now, and I would be surprised to see a significant break out beyond the bottom end of that range.  That said, dialogue from tomorrow’s FOMC announcement coupled with the potential for a miss on Friday’s unemployment data could provide the spark needed to do so.

Emini Daily Chart

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