Today’s drop below 20ma and 1095ES was seemingly inevitable when you look back and consider our highlights of the 3 days of failures to hold intraday highs, which indicated a loss of momentum as the market neared 1120 each time.   Only reason bringing this ‘inevitable’ is next time as traders, if we see such action again we will all have a better idea of what may lie ahead and trade it better.   

As to the seriousness of this break of support at this time,  it may not be so great.  We are still seeing better action in small caps (notably China’s today), Semi's (VECO  nch) acting well and we have a 4 week range low support at ~1085-1082.  Also,  the possibility of bullish December sentiment remains.   We are watching once again the 1085-1082 gap as crucial  support, which most likely needs to be tested.

Stocks had as many as 7-8 ‘small’ headline reasons to move lower.   Most notably, the Greek downgrade which played havoc on the Euro and therefore USD.  Also, more Dubai noise played on the USD.  As we've pointed out this trading hint before and it worked, sometimes in the markets when there is no 'ONE' big fundamental reason,  but many headlines the market comes back up very soon.   So, with that in mind and the 1091 close,  the break of the above supports today may not be all that bad.