Dow fell 504 points today following the Lehman bankruptcy and Merrill takeover. But today's market action cannot be considered a crash. Check the volatility index. It shows that there is more to come. I would like to see $VIX at 37s before considering any Long entry.
There was some panic but not enough panic to call a bottom. There are a lot of people expecting the market to be saved. The breadth was horrible today showing that every sector was affected.
No panic - No bottom- Market very risky. Stay in cash or short the market.
Ironically, Dow had fallen 508 points on the Black Monday -October 1987 crash, but that was massive panic and Dow was actually down 22%.
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