I believe that heightened awareness that the banking crisis is still not over and the risks of a second storm brought on by commercial real estate failures and hidden mortgage derivatives still exhibit a high risk factor to the overall market. Everyone knows the credit is very tight, and loans are hard to get. That makes asset prices fall. As a result, money is hoarded as many fear the risk of a deleveraging of the economy.

Let's take a look at the X-rays.

Currently, my indicators on all the indices are rolling over and are pointing to continuation of the primary downtrend. You can see on the chart of the Dow Jones Industrialsthat price has failed right at prior resistance and now looks like it is ready to test at least the July lows.

You can also see that the moving average convergence/divergence (MACD) in the middle of the chart has moved into neutral territory, as the stochastics have already crossed over into negative territory.

Dow Jones Industrial Average

Click here for larger image.

Source: TC2000