Some interesting facts from Sam Stovall of S & P. Basically the market tends to rally prior to a 15% correction. If not, it almost always leads to a new bear market that is defined as 20% down. When hitting a bear market, the average drop is usually 30%. So we either bounce off 1,040 or it really is likely that we hit the 20 or 30% declines.
Find it interesting that at times of such well defined trading levels that so many experts like Sam want to 'wait and see'. With commissions so low, it seems better to have bought the lows today with tight stops if the market shows any further weakness leading to the 15% correction and hence likely following panic repeat of 2008. Otherwise, an investor ends up buying at much higher prices in the 1,100 level when it supposedly is safer, but you then risk a drop back to 1,040.