Flash Alert: Out of Discovery Financial Services

After holding steady for most of the session, US markets tumbled in the final 90 minutes of trading and closed just above a key technical support at the February lows (roughly 1,045 on the S&P 500). As noted in last week’s issue of Stocks on the Run, a closing break to those lows leaves the S&P 500 vulnerable to a drop to 950.

We were stopped out of Discover Financial Services (NYSE: DFS) yesterday for a loss of just under 19 percent.

In May Discover and other credit card companies reported a further decline in the number of customers late on their payments. However, in market corrections, most stocks and risky assets sell off, regardless of fundamentals.

Fortunately, yesterday’s selling was offset somewhat by gains in two recommendations.

Raise your stop on ProShares Short Russell2000 (NYSE: RWM) to 37.15 from 36.15.

Lower your stop on the CurrencyShares Australian Dollar Trust (NYSE: FXA) short to 86.75 from 92.