On Monday investors were searching for clues, trying to figure out the market’s next big move after the prime minister of Greece stunned the Street.
George Papandreou said he will put the nation's bailout deal through a referendum, potentially undoing the agreement struck last week.
Both the Dow and S&P tumbled on the news as investors feared that a resolution to the overseas financial crisis was not at hand, after all.
In morning trade, the S&P 500 traded below its 14-day moving average for the first time since Oct. 7, which some investors interpret as a shift in short-term momentum. However, after the benchmark broke, it then went above strong support at 1,220.
Trader Zach Karabell thinks the market action into Tuesday’s close will be very telling.
“The question becomes will this particular story be the tail that wags the dog or will the earnings and stability in the US dictate the market action going forward. The afternoon will provide important insights into that question.”