The markets opened in positive territory this morning, but then turned downward, hitting a low just before noon ET. Then the classic "buy the dip" behavior began and everyone breathed a sign of relief. But someone gave the bear signal just after 2 pm ET, and the market traded off. SPX lost $9, closing at its low of the day at $1970. RUT has been consistently weaker than SPX, but today was an exception. RUT attempted to break out above the 200 dma, but could not hold it, closing up $2 at $1142.Volatility bumped up with the VIX closing up 0.7 points at 13.3%. Trading volume spurted higher, underscoring the market weakness. Trading in the S&P 500 was above 2.3 billion shares, well above the 50 dma. Trading volume increased 7% on the NYSE and increased 18% on NASDAQ.

A sideways consolidation would be healthy for this market and SPX has been trading in a tight channel for all of July. As long as the support range of $1950 to $1960 holds, we should be OK. A break below $1950 could be the beginning of something ugly.