Yesterday was another session of holding on and hoping for the best. The irony is that the havens continue taking body blows. Consumer Staples (XLP), Real Estate (XLRE), and Financials (XLF) are supposed to hold up under these conditions.

Energy (XLE) was the top sector, and had a couple of names among the top advancers list, but fertilizer stocks stole the show. I’m a little angry with myself, as I knew the Gulf regions’ importance to the industry, and I spied on CF Industries Holdings Inc. (CF) closely, but didn’t take action.

Lots of red on the Heat Map…if those big boxes hadn’t been green, yesterday would have been a disaster.

Breadth

If you can only glance at one thing to get a sense of the state of the market, it must be new 52-week lows and highs. The latter doubled the former, and decliners overwhelmed advancers.

Technical View

Right now, we are in “Code Yellow,” but the S&P 500 (SPX) drifts closer to the 200-day moving average.  That means more decisive exiting action, and being extra cautious about new ideas.

Cash is king.

Images from the Gulf

Each evening, we are seeing images of boats and tankers on fire, and that is being played up as the United States is losing.

The U.S. has to get ships going through the Hormuz Strait.

Today’s Session

Last night, I thought the market would open lower than indicated, but the big problem for today is how it turns around.

Selling begets selling, and at some point, could trigger wider fear.

Obviously, the White House is watching.

Right now, most of the street is crunching on how long it will take for things to get back to normal, as the longer the supply chain is shut down and disjointed, the harder it is to put it back online.

The market's resolve is notable, and the snap-back we saw the other day is indicative of what can happen with resolution.

 

I do not think the White House should base decisions on when to wrap up this operation on the markets. Markets react, and then they go back to normal.

I’m working harder now than when the market is on autopilot, and I'm excited when a great stock goes on sale even if it's uncomfortable in real time.

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