Wednesday Market Recap
| Asset | Current Value | Daily Change |
| S&P 500 | 2653 | -1.76% |
| DAX | 12,590 | 1.62% |
| WTI Crude Oil | 61.74 | -2.60% |
| GOLD | 1320.00 | -0.67% |
| Bitcoin | 7700 | 1.37% |
| EUR/USD | 1.2265 | -1.01% |
The aftershocks of the “Black Monday of 2018” are still clearly affecting the stock market, as volatility remained much higher than in the recent months, and despite the flat session, equities plunged lower again in after-hours trading.
VIX, 4-Hour Chart Analysis
Technically speaking, the rally is only an oversold bounce so far, and a re-test of the lows is likely, even if the volatility-driven crash won’t be the beginning of an outright downtrend. The futures contracts of the S&P 500 and the Dow are trading around 3% off the intraday highs as of now, and the pace of the after-hours decline suggests a very interesting session tomorrow.
Stocks are now the territory of traders, as from an investment standpoint, US markets are still way overvalued, and even the cheaper international markets are likely to provide meager long-term returns following the central-bank fueled bull market.
S&P 500 Futures, 5-Minute Chart Analysis
The late-day plunge got an unlikely boost from the Federal Reserve, as just a couple of days after Jerome Powell took the position of the Fed Chair, Fed President Kaplan told the press that he is not concerned about the decline in stocks that is a normal and healthy process. We are not sure that Mr. Powell will thank Rob for those words.
Dollar bulls, on the other hand, can be thankful for Mr. Kaplan, as the Greenback took off following his comments and never looked back during the day, finishing 1% up against the Euro, pushing the EUR/USD to a three-week low near $1.2250. The reserve currency gained significant ground compared to its other risk-on peers, while US Treasury yields also spiked higher again, which was among the triggers of the declines in the first place.
EUR/USD, 4-Hour Chart Analysis
Gold continued its correction amid the Dollar strength, but should the plunge resume, the precious metal could quickly climb back up towards the key $1350 level, following the orderly pull-back. Crude oil got a sizeable blow today, as not only the Greenback pushed the price of the commodity lower, but the news regarding the surge in US production also increased selling pressure on the WTI contract that slid almost 4%.
WTI Crude Oil, 4-Hour Chart Analysis
Cryptocurrencies
The crypto segment enjoyed a strong rally in early trading, which was followed by a brief consolidation, with the after-hours turmoil putting an end to that. The major coins are sliding lower yet again before the Asian session, but, for now, the coins are holding up well above their lows, as the bearish cycle’s end should be close or already hit.
BTC/USD, 4-Hour Chart Analysis
Despite the scary decline following the US session, there is still clear bullish signs in the segment, with the relatively strong coins, the oversold long-term momentum readings, and the favorable volume patterns all pointing to a weakening of the selling pressure. That said, as the downtrend is still intact, further volatile trading is expected, and an extended bottoming process could follow the steep correction.
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