The market was rocked by the news of SilverGate and Silicon Valley Bank failures, sending the market reeling with fear of contagion. The fear of this type of financial collapse spreading to other banks spooked investors, leading to big declines across the board last week.
Then the government stepped in. The Fed released a statement in which they assured depositors would be receiving all of their deposits bank in full, stemming the negative effect this event might have on the rest of the market.
As for our benchmark index, the S&P’s failure to hold the 3900 zone last week should be a sign of lower prices to come. A quick close back above that mark would likely negate that forecast. The next major level of support down should be 3800.
Today, we would really like to see the dust settle to see where the market will be headed in the wake of all this. If you were going to have a “risk-off” day, today would be a good day for that. Remember, cash is a position…
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