The DJIA slid to a 1-month low of 33,594 after the April CPI report came out stateside. The report had a bombshell effect on capital markets: selling intensified, while the market was agog with rumors that the Fed would be forced to wind down its stimulus and bond-buying programs ahead of schedule.
The DJIA could drop to 33,500 before investors decide to take a breather. Overall, the three-day sell-off has taken away some of the froth from the US stock market, but the pullback could deepen unless investors find something to hang on to.
After breaking through 33,500, the bears might push the benchmark down to 33,190 if the worst-case scenario materializes.