"Waiting for Godot" (S.Beckett)

I was bearish yesterday yet wanted to give current lows a chance to hold. That's what happened for a while with the confirmation of the 875-894 resistance area, to then see the negative tone resuming strongly, to the point that whether one wants or not, the market is VERY likely to go lower still... Maybe another 15% drop by year end (!) The good thing is that it would be at last the absolute bottom we are waiting for.
We however have Q3 GDP and a few other economic indicators coming so again we can't discard a minuscule chance of the bloodshed stopping soon.

"CAVEAT OF THE DAY": It must be said however, to those who still believe that markets will bounce and this crisis will be soon history, that they just fool themselves! Long term investors who have held tight so far and have not materialised their losses, certainly haven't lost anything as such. However returning to previous highs may take years and years ! Therefore once this painful deleveraging process is completed, it will stay that way! Even if there are TONS of (hard) cash waiting to be poured in the markets, leveraging will be limited, and there will be lots of arbitrage between sectors. The "sticking your head in the sand" ostrich behaviour is therefore certainly not recommended...

Back to our charts now for today:

ER: we're confronted to the same support level (~438-443) and again little chance it will hold. Difficult to say whether it will be a up day or a down day in the very short term, but NO significant bounce potential over a couple of days. We still aim at ~380 over the medium term.

ES:same story... short sellers may take some profit but except if Q3 GDP proves good end of the week, it will be a chaotic path to the low 700s...

EURUSD: still aiming at 1.22. Short term, MM stall level is 1.2329.

(http://en.wikipedia.org/wiki/Waiting_for_Godot)