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Stock Indexes Headed for Retest of Recent Low

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Another day of heavy selling has marked the end of this week's rebound, and a likely retest of last week's lows. Another plunge in bond yields to record lows and a 10% plunge in the price of oil are just two factors contributing to the stock selling. All eleven market sectors are in the red with five of them undercutting last week's low. Small cap indexes are falling to the lowest level since the end of 2018. It looks like an ugly end to a volatile week. Charts 1 and 2 show the Dow and S&P 500 indexes heading back toward last week's lows. Chart 3 shows the Nasdaq Composite in danger of closing below its 200-day average for the first time since last spring. We'll take a more in-depth look at the technical damage being done over the weekend.

Chart 1

Chart 2

Chart 3


Editor's Note: This is an excerpt of an article that was originally published in John Murphy's Market Message on Friday, March 6th at 3:03pm ET. Click here to read the article in that blog.

John Murphy
About the author: is the Chief Technical Analyst at StockCharts.com, a renowned author in the investment field and a former technical analyst for CNBC, and is considered the father of inter-market technical analysis. With over 40 years of market experience, he is the author of numerous popular works including “Technical Analysis of the Financial Markets” and “Trading with Intermarket Analysis”. Before joining StockCharts, John was the technical analyst for CNBC-TV for seven years on the popular show Tech Talk, and has authored three best-selling books on the subject: Technical Analysis of the Financial Markets, Trading with Intermarket Analysis and The Visual Investor. Learn More
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