12Jan10:42 amEST

Pocket Aces Cracked

We have a modest snapback rally taking place early on today in the broad market, with most indices up over 0.50%, and the Nasdaq leading over 1%. LULU and SBUX are some notably gainers, though LULU still has a damaged overall charts, and SBUX remans in dangers of seeing its long-term steep uptrend correct this year. 

Alcoa unofficially kicked off a new earnings season last night, and is getting sold hard today. This type of price action drives home the notion that the global economy remains under heavy pressure. And while it is easy to poke fun at AA's management and execution, in reality there are very, very few large aluminum producers in the world. So, it is misguided to treat them like they are an outlier. 

In fact, they are very much at the heart of the selling in the materials/energy complex. And on the multi-decade chart, below, AA (poker slang for pocket Aces) may have a visit with its 2008 crash lows around $5 in the cards soon. Also note that $5 area stretched back to the late-1980s as being important resistance, another piece of technical evidence that it may act like a price magnet. 

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