Waterfall

In a bear market, you don't have time to wait for perfect short opportunities.  The market follows its own timeline.  China is in crash mode, and Europe is just dead.  The US is the only thing keeping the patient alive.  But without QE3, the US patient is in critical condition.  More stimulants in the form of easy money is needed but the Republicans are putting on some serious pressure to the Fed to stop the endless money printing. 

Usually waterfall declines take 7-8 trading days to complete.  If you consider the start of the decline yesterday, we have till next Thursday/Friday till we hit bottom.  Who knows how low we can go in that time frame.  I am thinking 1070-1080 will be a price target for a reasonable bottom but we may just go straight to 1040.  Today, the AUD/USD is down almost 2.5%.  These are monster moves.  Euro is also getting hit but a relatively tame 0.75%.  Maybe the elephant in the room is not Europe, but the bursting of the real estate bubble in China.