The rumblings finally gave way to an emerging market debt rout. Courtesy of Zero Hedge,
Turkey alone impacts $350 billion among European banks. Maybe that's why Europe is getting smacked hard today across the board.
This not all about China, by the way. Debt is a global problem. And what is being demonstrated today is that currencies from countries with a current account surplus are being sought after while those from countries with a current account deficit are being penalized. So the market, when left to its own wisdom, can and does serve a self-regulating function and rewards good behavior while making it difficult for the careless. Perhaps that's why governments seek to "manage" markets.
Futures had a rough overnight session yet are only back to a larger 38% retracement level than I was looking at last week. So the market action has proved that I was incorrect in following the smaller pattern. Larger patterns trump smaller ones.
Futures broke the January 13th low. This equates to 1815.52 on the cash S&P. In doing so, the futures have completed a textbook 5-waves down from 1844, therefore a bounce to 1828 could materialize just when people are freaking out.
1828 on the futures equates to about 1832 on the cash S&P (I only bold the cash prices).
Elsewhere, here's a headline from the Drudge Report today about Justin Bieber that may soon describe the markets as well: