Simultaneously, the S&P 500 Index has incurred “real damage” as part of the fallout in commodities, Cashin added.
“We’re technically damaged. This morning, we broke the 100 day moving average, which was 2,034. You’ve done some real damage to the market in just one week, that’s what’s going to make the next two weeks very compelling,” Cashin said.
Investors have also digested a slew of speeches from Fed officials, with Cashin saying the central bank is trying to keep its options open. The chances of a Fed rate hike taking place next month soared after a much better-than-expected jobs report was released last week.
Although the timing is uncertain, some investors think the Fed could begin a tightening cycle as early as December. Others say tenuous conditions in the global economy may stay their hand.
“If they’re going to walk back from [raising rate], they’re not going to walk back this week,” Cashin said. “They’re going to wait right to the very end unless markets seem to get really bruised and they step back a little bit earlier,” he said.