As I mentioned last night, the market appeared ready to break to the downside out of its trading range. The bottom again was 1262-65 in the S&P. After finding support there yesterday, and for most of the past 5 weeks, today it fell through. That triggered sell orders that drove the market lower towards the other support levels I mentioned, 1247-50 and 1230-34. The market sliced right through the first one and closed right above the lower level at 1236. The surprise to me was how weak oil and other commodities were. I really thought we'd see a rebound in oil and a move down to 1200 in the S&P at the same time. That just shows us how weak commodities really are.  There must be some hedge funds in real trouble. By the way, this is what deflation looks like in asset markets when it occurs. Most everything goes down at once. But what next. We could see a bounce tomorrow and then the move down to 1200, or the market could just go ahead and go straight down from here. It really doesn't much matter how it gets there. The most important thing is how it handles 1200 when it does. A breakdown of 1200 in the S&P and 10,800 in the Dow will bring swift punishment from the "black boxes" that are already set to sell just below those levels. A hold of those levels and a move back towards 1300 will give a good trade but simply postpone the inevitable.......a devastating move much lower. The NYSE broke the July low today. The semiconductor index (SOX) not only broke it's low but triggered a head & shoulders pattern that gives a target 25% lower. I'm afraid these are indications of what's to come. This is a time to be very careful unless you know exactly what you're doing.