Today's market behavior and the Gulf spill do have their similarities, don't they? Correlation is running high along with volatility and containment is clearly a concern. Bill Luby posted a nice piece on prior crisis VIX levels before 2008 (about here at VIX 45). In contrast, the 2008 nose dive when those levels were breached represented containment fear, that markets were facing systematic failure. It seems to me that same question is being asked today.
I did put some money to work today on selective longs near SPY $108. It held fast the first go, but it feels early here as that level looks get retested and I am hardly in a rush to get over invested on a reversion play. Daily Sentiment is pegged to zero, so I assume we break those a.m. lows and start looking to next "support" (from yesterday's post, $105 handle).