The markets opened and traded down this morning, but had moved back into positive territory by the afternoon. However, a sell off in the last hour of trading wiped out all of the earlier gains. SPX lost $7 to close at $1757 and RUT closed at $1100, down $5.  Trading volume jumped up in this sell off with 2.4 billion shares of the S&P 500 stocks trading. Trading on the NYSE increased 15% and trading volume increased 20% on NASDAQ. Perhaps fund managers were taking profits at month end? Volatility was largely unchanged with the VIX at 13.8%, up a tenth of a percent. Today's drop on increased volume after yesterday's drop after the FOMC announcement is one more bearish signal for this market. Apparently, the Fed's pessimistic assessment of the economy was regarded as bad news this time, instead of the "bad news is good news" reaction we have seen recently.

The Chicago PMI jumped markedly from 55.7 to 65.9 for October. One might have expected that report to buoy the markets, but it didn't. Unemployment claims came in at 340k, down ten thousand from last week, but continuing claims rose by 38k.

$1750 was a weak resistance level for SPX on the way up. I will be watching that level for possible support. Otherwise, the top around $1730 from late September is the next solid support level.