Editor's Note:

Stocks made a dramatic move lower today but it's not a breakdown yet. You can see from the chart below that the S&P 500 index is on the verge of breaking down from its sideways consolidation. Of course there is always the chance that traders buy this dip near the trendline of higher lows.

Sometimes the best trade is no trade. U.S. markets might churn sideways in a volatile range while we wait for news on the Super committee's plan (or lack thereof) for $1.5 trillion in spending cuts. Their deadline is November 23rd.

If you are looking or a trade then further weakness in the S&P 500 might be an entry point for bearish positions on the SPY. I'd aim for 1200 but aggressive traders could aim for 1180. The Dow Jones Industrials Average looks like it could drop toward 11,650 if stocks continue to fall. Alternatively you could prepare to buy another dip in the NASDAQ composite, which has found consistent support near the 2600 level. Easy ways to play the NASDAQ(100) is the QQQ or TQQQ ETFs.

Chart of the S&P 500 index: