The Dow just tumbled back into the red for October but it is Trannies, Small Caps, and Nasdaq that are bloodbathing this month as risk-parity deleveraging slams US equity markets below critical technical levels...

The Ides of October...

Trannies now up only 1.5% YTD...

As the major US equity indices break below critical support...

Small Caps crash below the 200DMA...

 

The S&P broke notably below its 50DMA...

 

And Nasdaq has broken significantly below its 100DMA...

With aggregate stock and bond returns now significantly negative for 5 of the last 6 days...

With bonds and stocks selling off...

As Risk-Parity funds continue to delever...

And as Bloomberg's Michael Regan notes, massive volumes in S&P 500 puts are part of the reason why equities extended losses so sharply in early trading. Check out the volume in puts expiring Dec. 21 with a strike price of 2,850. The white line is today, while the red line is average volume:

(h/t Gaurav Panchal in London for pointing out.)