While the S&P 500 has fallen nearly 50 points at lightning speed, the decline is a mere two days old. While I certainly prefer the market today versus two days ago, we are not yet at a low risk entry point. It takes both price and time to swing traders back to excess pessimism. For instance, Rydex traders actually increased their bullish positions yesterday. When a decline is 10 trading days old we rarely see that type of bravery.
In the uber short term , we should see a bounce develop at some point this week. I thought the EU would announce some sort of large scale intervention before the European open but it is difficult to coordinate between so many countries. I remain of the belief they will do so before the end of the week as they have little other choice. At current interest rates, the peripheral countries have no chance. A bounce will likely coincide with this announcement, but it will likely be short lived.