Ugly reversal

What started out as a rally in US stock markets has turned into an ugly selloff. The S&P 500 is down 22 points to 2781 after initially rising to 2816, which was the highest since late-October.

The drop and outside reversal today highlights the Oct/Nov/Dec tops just above 2816. A fall below last week's low of 2775 would clear the way to the 200-day moving average, at least.

Ugly reversal

At this point I think it's safe to say that a US-China trade deal is priced in. Beyond that, what's the positive catalyst out there? Earnings have been mediocre and the latest economic data is middling. The Fed is already on the sidelines and a cut isn't going to come into play unless the economy gets much worse.