We warned of a late-day pullback on Monday as the bulls struggled in pushing resistance and the bears showed up right on cue to hand the blue-chips their fourth-straight Monday loss. We chuckled when we read some of the financial headlines on why the market dropped (more “taper talk”) but the real reason was the threat we warned you about between the U.S. and Syria.
It has been nice not to talk politics as the zombies’ vacationed for the month of August but they came back a week early after meeting over the weekend. We knew we would be writing about the DC gridlock in September over the debt ceiling debate and we were hoping it would be peaceful this week but yesterday’s bear attack happened after John Kerry made it pretty clear that the U.S. will likely strike Syria within 24-48 hours.
Throw in the fact another zombie headline that the U.S. will reach its debt limit by mid-October made for the perfect storm as the bulls once again stalled at resistance. Also remember these levels served as prior support so the lingering “tapering talk” had nothing to do with the pullback as much as these 2 events did. Now that we have cleared the air, let’s go look at the damage. (continued…)
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