Taking out a level does not mean anything, it could regain it afterward and it's all like it never happened, better to say taking out a level and watching the price action afterwards.
If we get below 1960 1900 is a given if you look at a daily profile. 1960 is also interesting if you draw a regression channel from the 3/09 low to now 1960 is that avg SPOOKY! I also just read somewhere that the dollar either hit it's high or low of the year in Jan 20 out of the last 21 years so that could be a catalyst for something, maybe at least steady oil.
The market IS telling me we are at a top, lower highs, and we now broke through the first level of resistance, commodities and bonds are confirming the market sell off, INTC had decent earnings, and it went down, we had a good jobs number, and the market went down, when stocks cant rally on good news, its a sign of a top, i say we test 1850 on the ES, I guess we will see whose right.
I actually wouldnt be surprised to see the market hit higher highs this year as well, but for the time being we are going to test the lows.
Just be prepared for next week ecb meeting.....that is going to move markets wildly ....everyone is expecting more free money, more propping up of the financial markets..more bailouts ......I meant to say more QE.... So get ready for more extreme volatility on January 22nd when ecb meets Just thank BUBBLE ben bernanke....all the central banks are following in his footsteps Haha