A view from Below…. 1000 Dow point drop

Today we saw a bad day in the financial markets made worse by an apparent trading glitch, leaving traders and investors nervous over how a mistake could send the Dow Jones Industrial Average into a 1000-point down. Though, we did recover at the close, only down 374 points or 3.2%. Investor’s confidences have been shaken but more importantly, technical (charting) supports have been violated. This means that we will see increased volatility in the near future and downward pressure for the stock market.

The markets violating technical support levels with the compounding of the uncertainty of the European debt crisis concerns over Greece may be reasons we see a downside with the markets for the short term. Let’s wait to see how low this market corrects and consolidates and review our risk models in our portfolios before we increase our exposure to stocks.