Key support, tested yesterday, has been definitively broken today. I refer to blog posts 01.07.08 and 01.15.08. A breach within the SPY $132-$135 level is imminent. We are now back at Fall 2006 pricing levels, gang.
We will see more of a decline, but before you panic and sell it all, at least take a moment to recall that one person's pain threshold is another's buying point. Whoops, we broke $135 before I could even get this posted... a very ugly day indeed.
11:30AM CST UPDATE: A little bit of a tick divergence became evident about twenty minutes ago and it seems we are finding some support at S2. I'm not too excited about it just yet though.
1:35PM CST UPDATE: The VIX at about 27 is up over 10% from yesterday's close.
2:10PM CST UPDATE: Monthly view and long-term bull market support...
2:45PM CST UPDATE: Have to get ready for the close, but while I would have liked to have seen more volume, we are seeing VIX readings at or near the recent typical "capitulation" level here with a 16% stretch from yesterday's close. Prospectively a very good day to consider writing out-of-the-money puts...
3:10PM CST UPDATE: Ouch. A note to you bears, remember August 17th last year, also a pre-expiration Thursday? "Short" of that, I believe we can next look to stronger technical support in the $130-$133 range, which we are right on top of. The SPY is down more than 15% from its Fall peak.
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