After an attempt by the BTFD brigade to restore balance to the central planning force just after mid day was thwarted by developments out of Saudi Arabia, the upward bias gave up the ghost and correlation trading took over, with complete flight to safety overtaking all novel factors, and the market closed below key technical support levels, including both the 50 and 55 DMA. In fact the market closed below the 55 DMA for the first time since September 1, 2010. The stunningly resilient Euro also plunged, as all capital flew to the 10 Year. The last time we had an open to close move as large as today's was August 11 2010, when the market was spooked by the then downgrade of the economy by Jan Hatzius. As a reminder, the only thing that saved the market in August, and why stocks took off and never looked back at the end of August, was because the Fed announced QE Lite in mid August, and then leaked QE 2. What will have it this time, nobody knows.
And there goes the 55 DMA