Futures are down decently this morning.
Recently, we had been telling you about a bunch of divergences in the market. Namely:
Advance declines not keeping up.
Anemic new highs vs new lows.
Small caps again underperforming badly.
Transports breaking support and the 50 day moving average.
Regional banks rolling over badly with bigger banks now following.
Junk bond proxies breaking support. (THE BIGGEST BUBBLE IN THE WORLD!)
But other major indices have been just fine but it is in the declining internals that give clues. So we start out ugly today. As we have told you, we are waaaaay overdue. Typically, markets back and fill their way higher. Recently, there has been no back. At any given time, it would be normal to knock a few off the scoreboard. Stay tuned!
The reason given is the worry about tax reform getting done. The worry is that the recent elections can take the momentum away. We are not so sure. Markets do go down every now and then. But we do believe the tax bill is suspect at best. We will have our thoughts on the tax bill as well as recent elections in a report tonight.