DOW open sharply lower today in response to worries over global outbreak of China’s Wuhan coronavirus. It hit as low as 27995.37 and is currently down -780pts or -2.7%. Currently it’s trying to draw support from 28000 handle, which is close to 28169.52 support, as well as 38.2% retracement of 25743.46 to 29568.57 at 28107.37. We’d expect current cluster level to provide some support for a recovery. However, it all depends on how the global outbreak develops. Another decline could send DOW to 61.8% at 27204.65, in rather quick manner.
10-year yield also suffers steep fall on massive safe-have flow into treasuries. TNX hits as low as 1.359, taking out 1.429 support decisively to resume larger down trend. Next near term target will be 100% projection of 1.949 to 1.512 from 1.639 at 1.202.
