Editor's Note

Will Thursday turnout to be a one-day wonder and give us a higher low? There is nothing to support that scenario until is actually happens. The major indexes closed at the lows for the day and none were particularly close to support other than possibly the Russell. However, S&P futures are up +10 tonight and several analysts are claiming this was simply a knee jerk reaction to the news and more than likely an Apple only story. Apple knew there was trouble ahead when they reported earnings for Q3 and said they would no longer report unit sales. Their warning was just confirmation of that outlook and even though they blamed it on macro events in China and Europe, it is more than likely a simple answer. iPhone sales have peaked without any new must have features and constantly rising prices. They are being hammered by dozens of other smartphones with similar features for half the price. Time will tell if investors are going to rush into this dip ahead of Fed Chairman Powell's speech on Friday morning. If we rebound from here it would be a higher low and suggest we are not going back to retest the December lows.

The chip sector leads the Nasdaq and chips lost 6% on Thursday. They will have to rebound for the Nasdaq to rally.

 

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