Psychology Sours, Stocks Sink

The problem with psychology is that one man's sell signal is another's buy.

To wit: If the worst same-store comparison for Wal-Mart in 10 years produces this reaction, "maybe things aren't that bad," says Bollinger, acknowledging that the big down day is a warning, "but not a glaring call to panic."

Pado agrees, adding that Wal-Mart's misfortune may well be other retailers' gains come Thursday's same-store sales report.

Indeed, investors who sat out the summer rally have repeatedly expressed frustration about never finding a good solid down day to get back in. "This gives people more opportunity to buy in," says Hogan.

Whether the market's drop is a pause that refreshes or the decline that provides the kicker to what has been a year of antiseasonal trends, no one can know yet. The best option may be to read up on your Freud.