Technical Picture - Pre-Earnings Pessimism

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Late day support kept the markets from closing at session lows. Still, losses were deep and broad-based, extending last week's declines. The rising wedge channel has clearly been breached, however, volume was just slightly higher than Friday, leaving the door open for some stabilization after a deep pullback. 850 is a key pivot point support level for the S&P.

The recent downturn came as market participants prepared for an earnings season that began this evening when Dow component Alcoa. Despite, lowered guidance, AA missed by a long shot and after hours, the stock closed well above session lows.