Dow 8579

WTF just happened?

Okay, our Dow 10,000, 9500 and now our Dow 9,000 targets have been hit.

Where do we go next — are we close enough to a bottom to buy, or are we heading much lower? 

Dow is now off 39% from its highs.

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This cascading waterfall selloff is ugly. Next key level of support is 8750, where we would again be buyers of the market.

If that does not hold, then we are looking at no support until the 2002 levels — about 7250. (I may have to dust off that Dow 6,800 call).

As we noted earlier, tomorrow is that huge Lehman derivative settlement, and I wonder how much of this action is due to that.

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