Here are today's charts in the following order:
SPY, QQQQ, IWN
The markets first tumbled a bit after 11 EST. Notice the three really strong downward bars on strong volume. This indicates there were a ton of sellers and they were in complete control.
About 12:30 the IWNs sold-off. Remember the Russell 2000 have performed slightly better for the last few sessions, meaning there were more profits to book.
All the averages tumbled again at 1300 and the QQQQs and SPYs had a volume spike at this time. Again -- a ton of sellers enter the market and they are in complete control of all the action.
Notice how all the averages died at the end on extremely heavy volume. This was literally a, "Katy bar the door" moment in the market when everybody wanted to get out.
Also note the markets continued to trade down throughout the day and closed near session lows. These are all bearish signs. The continual downward trend indicates the market could not find a bottom during trading. Closing near a low, on a sell-off on very high volume indicates people were dumping shares. That means they are nervous about what news might come out tonight and tomorrow morning.
According to Briefing.com:
If the problems in the subprime mortgage market have got you down, the Mortgage Bankers Association didn't do anything today to lift your spirits. If anything, it dampened them even further with a declaration that delinquencies among subprime borrowers hit 13.33% in the fourth quarter, which is the highest rate since the third quarter of 2002.
Here's a chart from CBS Marketwatch that shows the foreclosures:
In addition, the NYSE delisted New Century Financial which was the second largest subprime mortgage lender in the country until recently.
We also had a bad retail sales report, which indicates housing problems may be spilling over into other areas of the economy.
So, adding all of this up, we get a market that has concerns about the housing market, some general fear left-over from the most recent slide and overall concern the housing slowdown is seeping into other areas of the economy like consumer spending.
The bears are making their voices heard.