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ALERT: Rob's "Hot" Technical Take on today's equity sell-off. Cyclicals need to "dig in"



I like the bounce at the index level after the weak opening but I was disappointed with the cyclical action.

- Internals were weak,
- SPHB broke the 50 and the June 26 lows,
- Small caps weak and banks (KRE) and
- Energy weak with relative performance bleeding.

I was expecting/hoping cyclicals would act better. Ideally/hopefully we're looking at a mini retest/undercut of the June 26 lows but the cyclicals need to start digging in soon.

I'd love to see the VIX take out that 26 support level. Option expiration is next week starting on Wed with index options. So I'm thinking that could hang on the market for another few days but then we head higher. Cyclicals haven't reached extreme o/s yet but they def have worked off the overbought condition from the June 8 highs.

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