7:30 a.m. EST.
Yesterday we warned readers of this blog that it was going to be an UGLY day. Today we expect to see a much more subdued market. But make no mistake about it, yesterday was a day the pros made money and the public lost money.
The sharp downward spiral yesterday clearly did a lot of technical damage to the internals of the DOW and S & P 500.
So what's today going to be like?
Here's how we see it.
The market did some serious damage to itself when it crashed through the support levels we outlined yesterday.
Here are the support levels again.
DOW: 13,400 SUPPORT
NASDAQ: 2,770 SUPPORT
S&P: 1,489 SUPPORT
In classic technical analysis, support levels once broken become future resistance levels. Rallies back to old support will be met with professional selling.
Bottom line. We now have technical target zones to the downside for the S & P index of 1,430.
If there's no strong rally today (we don't expect this to happen) and the major indexes close little changed for the day; then the day to watch is going to be Friday. If the market closes to the downside on Friday, it's a very bad sign, which would indicate more bad news over the weekend, which in turn will put pressure on the market on Monday.
The old market adage is "They slide faster than they glide".
Translated, markets fall faster than they go up.
Friday is the key.