This is one of the major questions over the last few days since the heavy falls in US stocks. It is easy to see why as well from a technical perspective. The recent declines in the Nasdaq bear some of the hallmarks of a deeper slide. There are two aspects that stand out. Firstly, the range of selling. Three days of selling from 03, 04, and 08 September (remember Labor Day holiday) have seen price erase over 12 days worth of buying.

Secondly, the break of the June 29 and July 24 ascending trend line possibly signals a deeper correction to the downside.

However, many in Wall Street see this as only a correction

Here is a sample of some of these views from a Reuters piece yesterday:

• Goldman Sachs repeated their year-end price of 3600 for the S&P500.
• UBS Global Wealth Management advised clients to ‘ease into the markets’ rather than stay out.
• SkyBridge’s co-chief investment officer Troy Gayeski regards this as a ‘healthy correction, removing the froth’.
• However, with the US November elections on the way, not everyone is so optimistic.
• Stanley Druckenmiller, firmly in the bear camp, warned that the stock market is in a mania fuelled by the Federal Reserve.

So, how do you navigate these kind of markets? Well, one way is to take a look at key technical levels to assess what is going on. Are key moving averages being respected? Has priced just sliced through a key support level? Does the sell-off extend from the Nasdaq to the broader market? Allow the technicals to guide you in these uncertain markets.