CHESSNOID

Incredibly enough, the US stock markets have fallen 4 weeks in a row. The economy is no different than the last 3 years, but investors are starting to realize the reality we live in. Dow’s down 11%, S&P 13%, Nasdaq 15% for August which are big numbers for just one month.

NEW YORK (MarketWatch) —

U.S. stock indexes on Friday stretched losses into a fourth week, as apprehensive investors remained on alert for any sign of trouble or resolution from the European Union and its banks.

“Given we have a high level of anxiety and we’re coming into a weekend, people would rather be flat than long,” said Randy Frederick, director of trading and derivatives at Charles Schwab Center for Financial Research.

“The only thing that would make it cascade below levels we put in last week was if we found the EU really turning into a banking crisis,” said Michael Gibbs, a managing director and director of equity strategy at Morgan Keegan.

The Dow Jones Industrial Average DJIA -1.57% and the Standard & Poor’s 500 Index SPX -1.50% both closed out the week at levels above their closing lows of the prior week, when a volatile market had the Dow making triple-digit moves each day.

After climbing as much as 120 points during Friday’s session, the Dow industrials lost 172.93 points, or 1.6%, to end at 10,817.65, down 4% from the week-ago close.

Hewlett-Packard Co. HPQ +0.08% weighed most heavily among the blue chips, off 20% a day after the personal-computer maker reduced its outlook and said it might spin off its PC unit. Read what analysts are saying about Hewlett-Packard.

The Standard & Poor’s 500 Index fell 17.12 points, or 1.5%, to 1,123.53, down 4.7% for the week but above the prior week’s closing low of 1,119.46, hit on Aug. 8.

The market is “following a normal path of figuring out if the lows of last week are indeed the bottom for this correction, which is EU driven, and EU focused,” said Gibbs, a managing director and director of equity strategy at Morgan Keegan.

Should the index close below that level, “it stacks the odds the lows are not in,” said Gibbs. “You can’t draw a line in the sand, you have to eyeball that now expecting the market is going to bounce around it or even under.”

The Nasdaq Composite Index COMP -1.62% fell 38.59 points, or 1.6%, to 2,341.84, off 6.6% from the week-ago close.

For every stock rising three fell on the New York Stock Exchange, where 1.5 billion shares traded. Composite volume neared 5.4 billion shares.

The market trend is pointing down, but I expect it to bounce up Monday unless we have some unexpected bad news. I will post some charts later to show you why I think the technicals point down.