Exactly one month ago (and 1,500 points in the Dow Jones Industrial average) I wrote “Three Charts That Give Me Pause,” making the technical case for caution in the stock market. I followed this post up with “Three More Charts That Give Me Pause,” making the fundamental case for the same.

Obviously, I had no idea stocks would fall as far and as fast as they have over the past month (thankfully, however, I was prepared). Interestingly, we've quickly approached an important line in the sand: 1150 for the S&P 500 Index.

As the chart below shows, 1150 is roughly the mid-point of all the action over the past decade-plus. We've seen it trade 400 points higher, 400 points lower and also meander around this level at times as it has acted as support or resistance.

To my eyes, this area needs to hold this time for the bull scenario to survive. For if it gives way, we may be looking at another test of the “400 points lower” range. 

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