Hunt for Red January

"Give me a ping, Vasily. One ping only, please."
--Captain Marko Ramius (The Hunt for Red October)

Equity markets completed one of their worst opening weeks in history with another weak day on Friday. Most major equity indexes lost at least 5%, with China's Shanghai Composite down about 10%.

With Friday's -1% showing, the SPX is within pinging distance of the August lows of 1880ish. While short term oscillators are 'getting there,' they are by no means deeply oversold, and longer term oscillators are just beginning to turn down.

Plus, while a rally to relieve some selling pressure could certainly happen at any time, bears have been burned so many times before that many are underexposed here--meaning that there is less liquidity to sop up downside selling pressure.

Stated differently, one can't rule out an 'elevator shaft' type drop from here, particularly after market participants who increasingly feel trapped have the weekend to think about it.

position in SPX