Losses were carried over from yesterday’s session as volume jumped today.  We have seen the first real distribution in quite some time as volume soared above Monday’s level.  The lone sector in the S&P 500 in the green was the Utility sector.  Selling was persistent from the start of the session and finally subsided by noon time.  Last week’s gains were gone in a flash and as well as the gains from Thursday’s job report.  We now have some red flags popping up with stocks we have been watching over the last month.    Today’s market move is eye opening in many respects, but we will heed our price signals.  However, we aren’t ready to go into full blown sell mode just yet.  There is caution being thrown to the wind at the moment and it pays to obey the process.

Outside the United States the DAX index has had a bad two days.  The index just witnessed back-to-back session of more than 100+ point losses.  Other weak indexes in Europe include the FTSE 100 (UK), CAC (France), IBEX (Spain), and FTSEMIB (Italy).  It appears European stocks are having a difficult time navigating the waters as of late despite the ECB’s plan to collateralize debt and begin their own QE program.  More importantly the DAX is the barometer of Europe as it is the healthiest economy.  What happens when DAX moves much lower?  Follow price and at the moment these are nearing sell mode.

NASDAQ is something to look at as the index was off 1.35% on the session.  Volume for the composite index was above average by more than 10%.  Institutions were in selling down NASDAQ listed stocks.  This certainly doesn’t mean this is the end of the uptrend, but it does put us on alert.  The initial sell-off won’t be “the” sell-off everyone will refer to.  In 1987 the top came in August not in October.  Yet everyone talks about October.  Every big decline is always a secondary sell-off from an initial sell off where the rally to regain the previous high fails.  Is this the initial decline ahead of a bigger decline is anyone’s best guess.  However, if it does lead to something more sinister we’ll be on top of it.

Tomorrow everyone in the financial media will be looking for the recent Fed minutes to move the market.