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BofA Warns, Big Trouble In Small Caps If This Line Is Crossed

Tyler Durden's picture




 

US equity price action warns of trouble, BofAML's Macneil Curry warns. Since the start of this year, Tuesdays have consistently resulted in positive returns for US equities; but this week's failure to follow through with that pattern, coupled with the Russell 2000’s first close below the 200-day moving-average since November 2012, warns of trouble ahead.

 

Indeed, the Russell is dangerously close to completing a 4 month "Head-and-Shoulders Top". A close below 1099 is needed to complete the pattern, exposing significant downside to 1057 (5-year trendline), ahead of 988/975 (Head-and-Shoulders obj.).

 

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Thu, 05/08/2014 - 15:14 | 4740776 HedgeAccordingly
HedgeAccordingly's picture

Big Trouble in Little China? i mean midtown 

http://hedge.ly/W5B2M9

Thu, 05/08/2014 - 15:32 | 4740857 max2205
max2205's picture

It stinks out there

Thu, 05/08/2014 - 15:49 | 4740911 viahj
viahj's picture

if Nov '12 is any indication of anything, it's of a BTFD opportunity for BoAML who is asking you to sell into.

Thu, 05/08/2014 - 15:47 | 4740913 power steering
power steering's picture

But the Dow

Thu, 05/08/2014 - 15:40 | 4740882 Say What Again
Say What Again's picture

HA-Guy -- how come you are always the first to post?

Sorry, but I will not go to your blog

I try to avoid web sites with a "LIBYA" domain (.ly)

 

Thu, 05/08/2014 - 15:15 | 4740782 NoDebt
NoDebt's picture

My screen is showing an odd shade of green for this time of day.

Thu, 05/08/2014 - 15:20 | 4740791 AccreditedEYE
AccreditedEYE's picture

Again with the BofA research? Really?! One would almost think that you post this to encourage Bulls on your Bearish website.

It's all good...this will just make the 500th time they look like idiots.

Thu, 05/08/2014 - 15:29 | 4740836 power steering
power steering's picture

You going to average down on whole foods?

Thu, 05/08/2014 - 16:41 | 4741071 Fuh Querada
Fuh Querada's picture

is that a vagina soaked in gasoline and ignited?

Thu, 05/08/2014 - 15:17 | 4740793 JustObserving
JustObserving's picture

Mr Chairman, get busy and put your HFT computers to work on the Ruseell 2000.  Or are they too busy attacking gold and silver?

Thu, 05/08/2014 - 15:18 | 4740794 fonzannoon
fonzannoon's picture

I know whenever i see the dow about to tank near the close I jump up and buy it. i presume everyone else did too...

Thu, 05/08/2014 - 15:18 | 4740795 buzzsaw99
buzzsaw99's picture

in what universe are stocks allowed to fall?

Thu, 05/08/2014 - 15:21 | 4740802 Winston Churchill
Winston Churchill's picture

When DXY has to be defended.

Thu, 05/08/2014 - 15:30 | 4740844 buzzsaw99
buzzsaw99's picture

in what universe does the fed wish to defend the dollar?

Thu, 05/08/2014 - 15:48 | 4740917 BlindMonkey
BlindMonkey's picture

It is the same universe where the dude that pulls the rug out from under you hopes that you don't hit your head too hard and die.

Thu, 05/08/2014 - 15:38 | 4740800 HardlyZero
HardlyZero's picture

MZZ, QID, and SRTY is good now...bottomed out finally.  

TWTR was the key on Tuesday with huge volume.    http://finance.yahoo.com/q/bc?s=TWTR+Basic+Chart&t=5d

Today looks like dead cat bounce for markets.

Thu, 05/08/2014 - 15:21 | 4740805 jomama
jomama's picture

because fundamentals matter anymore.

Thu, 05/08/2014 - 15:22 | 4740808 Fuh Querada
Fuh Querada's picture

Which 200 DMA?
Simple, linearly weighted, exponentially smoothed, Wilder, geometric , triangular or variable?
And why not the 192 or 205 DMAs which take account of vacations and long nights in the bar?

Thu, 05/08/2014 - 18:25 | 4741389 Bunga Bunga
Bunga Bunga's picture

Because all lemmings are watching the 200 DMA.

Thu, 05/08/2014 - 15:23 | 4740813 fonzannoon
fonzannoon's picture

the good news is the market can go higher with every stock going lower. that is pretty cool.

Thu, 05/08/2014 - 15:41 | 4740888 Seasmoke
Seasmoke's picture

Just like Gold and silver go lower , even though more and more of physical is bought. That also is pretty cool.

Thu, 05/08/2014 - 15:23 | 4740815 PlusTic
PlusTic's picture

3:30pm ramp-up is gettin its fuel ready now...

Thu, 05/08/2014 - 15:26 | 4740826 Kreditanstalt
Kreditanstalt's picture

Yeah, but it's increasingly just machines swapping stocks back and forth to one another, and institutions and funds doing the same.  No value is being created and there can be no real profit unless they can get enough mom-and-pop muppets to buy.

TPTB don't like this.

Thu, 05/08/2014 - 15:48 | 4740886 HardlyZero
HardlyZero's picture

Wall Street Channel Stuffing ?   There is so much liquidity in the channels now getting blocked up, the bots migh burn-out their transistors as the melt-up melts-down.

 

Looks like NBI missed the 3:30 bounce.

 

Dropping into Friday...if this Ukraine and China thing keeps escalatin' and Putin instigatin' then Friday and Monday may be amazin'.

Thu, 05/08/2014 - 18:52 | 4741501 Wahooo
Wahooo's picture

I mistakenly read your comment as "...just war machines swapping stocks back and forth..."

Sometimes the mistaken is correct.

Thu, 05/08/2014 - 15:34 | 4740866 Yen Cross
Yen Cross's picture

  Like one of those Russian TOPOL mobile launchers...

Thu, 05/08/2014 - 15:23 | 4740816 Kreditanstalt
Kreditanstalt's picture

All this worry - and a war threat too - and "The Gold Price" is TOTALLY NON-RESPONSIVE.

Thu, 05/08/2014 - 17:18 | 4741175 Poor Grogman
Poor Grogman's picture

Don't mention gold.

That dreaded stuff is what's causing the problems in the first place

Thu, 05/08/2014 - 15:26 | 4740825 fonzannoon
fonzannoon's picture

the dow shot higher literally as gartman was on cnbc talking about how the market rally failed. The stock market is now a sarcastic guy.

Thu, 05/08/2014 - 15:31 | 4740854 yogibear
yogibear's picture

Jack Lew and Yellen rush into Obama's office and say we need much more QE or else the system blows up.

Theft Plan #2.

Thu, 05/08/2014 - 15:44 | 4740864 Itchy and Scratchy
Itchy and Scratchy's picture

Last 3 months : Retail Clients Buying  buying from Institutional Accounts

Same old same old.  Nothing to see here. Move along.

Thu, 05/08/2014 - 15:35 | 4740867 Ghostdog
Ghostdog's picture

Big trouble when I start listening to bofa dipshits

Thu, 05/08/2014 - 15:49 | 4740892 HardlyZero
HardlyZero's picture

yes.  however 99% of the MSM dips read and follow these lemmings.

Thu, 05/08/2014 - 18:17 | 4741357 Ghostdog
Ghostdog's picture

A sucker born every minute, right? Hard to believe with such a good educational system at such affordable prices...

Thu, 05/08/2014 - 15:36 | 4740868 The worst trader
The worst trader's picture

And because ZH posted this the line will not,I repete the line will not be crossed! JY, KH

Thu, 05/08/2014 - 15:38 | 4740878 Itchy and Scratchy
Itchy and Scratchy's picture

Note to financial advisor: How's my triple levered bull bio-tech startup pre-FDA drug development retirement fund that I bought last month doin'?

Thu, 05/08/2014 - 15:39 | 4740879 bbq on whitehou...
bbq on whitehouse lawn's picture

Janet Yellen said something today that seems to be overlooked: "Substantially lower" in reference to the FED balance sheet.
So is that numerically or is that purchasing power.
If it is about numbers and politics then its deflation; if its about power or numbers no one will care about then its inflation and a 70's "Goodtimes" redux, with an "Abenomics" twist.
Can you break the dollar and kill yield?
We will find out.

Thu, 05/08/2014 - 15:43 | 4740894 LibertyBear
LibertyBear's picture

Send in the Volume!

Thu, 05/08/2014 - 16:03 | 4740964 scubapro
scubapro's picture

 

 

under 1099, like just now?

 

BAML has not had the hot hand lately though.

Thu, 05/08/2014 - 16:04 | 4740969 Spungo
Spungo's picture

Oh fuck! More pinks lines!

Thu, 05/08/2014 - 16:14 | 4740992 Yen Cross
Yen Cross's picture

  My chart shows this as the 3rd close below the 200 day average. He must be using exponential. (I'm using simple)

   1114.86 200day simple.

Thu, 05/08/2014 - 16:21 | 4741014 bbq on whitehou...
bbq on whitehouse lawn's picture

To make good on all State Fed pentions: 401k, Ira,.... The fedor state must kill yield, pay off debt and debase currency.
If you were a twit with a .gov pension what would you do?

Thu, 05/08/2014 - 18:49 | 4741488 Wahooo
Wahooo's picture

Seriously, how come nobody likes small caps?

Thu, 05/08/2014 - 16:22 | 4741019 NOTaREALmerican
NOTaREALmerican's picture

Cue:  Hindenburg Blimp music.

Do DU, do DU, do DU, Do DU, do DU, do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU, Do DU,

Thu, 05/08/2014 - 17:33 | 4741217 Zero guest
Zero guest's picture

How can we have a bear market with all these timely warnnings?

                                                                                   

Note: The Dow still within tge confines of the triangle that began in 2000.

Thu, 05/08/2014 - 20:21 | 4741751 NESD
NESD's picture

It is hard not to notice that last time the index traded below the 200 MA in Nov 2012 the index quickly recovered and provided solid gains for those who did not buy the doom and gloom arguments.  It is hard not to notice that the billions of funny money the Fed prints are not going into Main Street, it is going into the financial markets.  Looks like another buying opportunity to me.

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