Back With A Vengeance

September is sure off to a fine start by living up to its reputation for being a rough month for the market. Although there were high hopes that as Wall Street returned to work this week we'd see the big buyers return, instead the bears are back with a vengeance.

There were lots of reasons for today's decline including the fact that market participants just have lost patience. After failing once again to take out the 1300 level, they're in give up mode. Rumors that several hedge funds are imploding are also not helping matters.

The bottom line is that the market broke through some key technical levels (S&P 1250 for one) and we're setting up for a move back to test those July lows. Needless to say, it is so very important that we don't set a lower low in this cycle as it only will strengthen the long-term downtrend channels we've been monitoring all year.