13Mar10:31 amEST

Sleeping By the Bear

Despite the KRE (regional bank sector ETF) down another whopping 16% this morning on the back of SBNY SIVB getting wiped out and a whole host of other regionals getting walloped, bulls are piling into AAPL and Treasuries (as well as some crypto) with the hopes of riding this out as being a banking issue contained to the regionals. 

While that may be the case, I still have my doubts as it smacks more of pure hope within the context of an overarching bear market, which almost always results in a broken hearts for bulls. You may also notice the jittery nature of the price action with fast moves down and up intraday, both during the futures sessions and cash right now. 

That is all part and parcel of a bear market on edge, as we are seeing now. 

Gold and the VIX are also finding bids, as market players lurch towards some semblance of a hedge in light of the known unknowns about the banking system and just how bad things may or may not be below the surface. 

Into the rest of the morning and early afternoon, I would view a move back below 3820 on the S&P 500 Index as signaling that dip-buyers are losing any grip on the action. At that point a waterfall type of move should be in play. Also look for the VIX to clear 30 this week to usher in a higher volatility regime to coincide with stocks finally going--and staying--down for a bit.

The moves in the KRE are serious and should not be taken lightly, as even the bigger XLF banks are getting hit, too.

When you consider the S&P is still able 3800 it is almost laughable at how desperate some big-time investors were for a bailout/backstop over the weekend. You can only imagine the crying when the S&P is at 2800 or, Heaven forbid, 1800. 

Weekend Overview and Analysi... Danger, Curves Ahead


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