This is the third year in a row that the worries in Europe have bled into our markets and done so in a rather quick manner. The last two times the corrections ranged from 12% to 20%. This one has only take about 4% off the markets so far but today we will look to stretch that a bit farther as Asia was down a good piece and Europe is getting hit hard. The worries over there are from all corners with failed budget agreements, bad economic data, rising rates and a failed bid by the French President to win the first round of the elections. There are those who say that if everyone is so conditioned to expect another sell off due to Europe then it likely won't happen and I can't disagree with the thought. Basically if everyone expects something it tends to be less likely but that doesn't mean it won't scare many into believing it and acting on it to some degree so even if it doesn't happen it may appear to be so for a while. This morning certainly "appears" that way.

I have been preaching that there is a range setting up for a good month now and that is what we have. The issue is where is the bottom and top when these things form. I have outline my specific thoughts to subscribers of the various services that we offer here at TA Today so its not appropriate that I outline them here but let it be said that the lows from a couple weeks ago are definitely the current boundary and they will most likely get tested. You have to measure that test and decide what to do when it occurs. It is a critical test when it comes.

Outside of equities, pressure is being placed on other sectors as well. Commodities have been selling off for quite a while. There is a lot of economic news this week including the FOMC meeting on Wednesday and that will be critical because this market continues to be held up by alternating views of an economy that continues to muddle along to one that Uncle Ben will step in and rescue. As long as those thoughts remain dominant it is going to be hard to kill this bull market. It's all about corporate profits and so far they continue to look pretty good overall.