Ratings agency Standard & Poor's cut its outlook on the U.S.'s AAA-rated debt to Negative from Stable today, and that unleashed some aggressive selling. The market recovered a bit late in the day, with help from a strong bounce in AAPL, but it still was a very poor day for the bulls. Volume was not heavy but breadth was 4-to-1 negative and with plenty of technical damage.
There was a little panic that became oversold fast enough to support some sort of snapback.
The good news is that we do have earnings reports coming from TXN after the close, GS and JNJ in the morning and then IBM and INTC after tomorrow's close. That is going to change the focus for at least a little while, and we might be able to generate a little more upside action if the reports are upbeat. But earnings season so far has reflected a desire to exit on the news. If that continues, it is going to be very rocky going.