What to do When the Dow Jones Falls 500 Points


 
 
02:46 10/10/2018

It’s a great day to be a trader – if you’re short.

At the moment, the Dow Jones is down 520 points, and getting worse. With elections nearing, bond yields rising, and tech stocks retreating, markets are in a state of panic.

The benchmark 10-year Treasury note yield rose to 3.25% and hit its highest level since 2011. The 30-year bond yield also reached its highest mark since 2014. Neither is sitting well with traders. That's because they lead to expectations of tighter monetary policy, which can cap company profits, potential dividends, and throw a wrench into things.

Technically, things don’t look so hot either.

After testing double top resistance, the Dow Jones just fell below its 50-day moving average. Should current support fail to hold, we could plunge to the 200-day at 25,140.

October is truly living up to its reputation as the worst month for the markets.

All three indexes are in the red this month. But the Nasdaq has really taken it on the chin: It has plunged from 8,100 to 7,543. It’s headed straight for its 200-day just under 2,500. Should that line in the sand fail to hold, we could see a test of 7,250, near-term.


This article has been provided by a Chasing Markets contributor. All content submitted by this author represent their personal opinions, and should be considered as such for entertainment purpose only. All opinions expressed are those of the writer, and may not necessarily represent fact, opinions, or bias of Chasing Markets.
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