Equities rebounded on Thursday but the move was small and traders are cautioned not to read too much into the move. Price action remains bearish in the wake of the October CPI report and suggests a deeper decline is in store for the market. The broad market S&P 500 is already down a full percent from the recently set all-time high and could easily fall another 2.0% before hitting the first significant target for support.

That target is at the short-term moving average, near 4,565, but there is no guarantee the market will halt its decline there. With inflation accelerating to new highs and no end in sight for the trend the market could correct a full 10% to 20%. Today?s action will be telling. If the market moves lower and ends the week at the low of the period next week?s action could bring even more selling.