This morning I posted the following chart on my instablog over at SA during the first hour of trading. What we had was a sharp drop at the open which saw the SPX violate the lower support line of a descending triangle, as well as breaking the 50 day. The rest of the day didn’t bring much improvement, and we closed near the lows with a surge in volume. The techs and small caps were really hit hard.
Based on the overall market picture, I think there is an increasing probability of a severe break in stocks in the near future. I will outline my thoughts on the data in more detail over the weekend in my regular market review.