The major indices have sold off in the second half of August in response to inflation fears and future interest rate hikes from the Fed. The S&P 500 Index (SPX) is currently trading above a key support level, and how price reacts around that level may indicate whether the sell-off steepens or we rebound and rotate higher. The key level to watch is around 3950. If we see the SPX close below that level we are more likely to see a continuation of the sell-off. If the 3950 level holds and the SPX trades higher off that level, it may be an indication that the August sell-off is over and a resumption of the uptrend that began in June is more likely to resume.