Small-caps and momentum stocks suffered their worst action since the final meltdown back in February. The major indices were ugly as well, but they really didn't reflect the carnage under the surface. The recent trading favorites were dumped like overripe onions, and the technical damage was quite notable in many cases like BIDU and CME.
The big technical level that everyone is watching right now is 900 on the S&P 500 -- not only is it a nice round number, the 50-day and 200-day simple moving averages are converging right now. I thought we might see a better attempt to hold that level, but the dip-buyers had absolutely no juice today.
The next area of technical support is the May lows around 878 or so, but the damage is already being done with the action today, and the trend shift is under way. I'm still looking for some reprieve as the end of the quarter approaches, but the chances of a quick and easy recovery like we saw in May following a dip are very remote.
It is not a good sign that there was no interest at all in buying the weakness today. They couldn't wait to jump in just a couple weeks ago, but today the buyers had no conviction at all. At this rate we'll end up oversold and ready for a bounce fairly soon, but the character of this market started to change last week, and today just verified that the euphoric "the worst is over" celebration is coming to an end.