The DOW is off nearly 4% this morning and I think its time to slowly start accumulating some index calls (SPY, DIA, QQQQ) as they start to get depressed. Now, don't go crazy buying here because if things get worse you should have some cash to buy more at even lower prices. I think the worst is still ahead of us once earnings season starts, but for now there seems to be blood in the street for stocks (which may be a good time to slowly start buying). I'd like to see a bit of a relief rally (more sustained this time) over the next month or so. The SPY's look particularly interesting and should move close to the highlighted area in the next month or so.
Oil also has taken a beating lately. Make no mistake, strong oil prices are needed to sustain a strong economy. When oil is rising there is demand from consumers and companies which means the economy is strong. It used to be that when oil fell the markets rallied but take a look at how oil has fallen basically in lock step with the markets recently. OIH is particularly oversold and should come back up to the 130 level.
