An overnight, global sell-off is weighing on the futures early this morning as the bear market behavior begins to take hold. With so many stocks under their 200-day ma, the path of least resistance is down until a reversal occurs.
For those of you trading from the signals within The Machine, you’re beginning to see the healthy gains on the short positions – especially in stocks. This would be expected especially this early into the bear cycle as its beginning to replicate the same behavior seen in 2001-2002 and also 2008.
The market is likely going to require some sort of major event, either political or a string of unexpectedly strong economic reports, to reverse course from here.
The above is from Larry Connors’ Daily Battle Plan.
To learn more about the Daily Battle Plan – including access to Larry’s daily ETF trading signals, click here for more information.
And for more on ETF trading, be sure to visit us here to check out the book that Stocks, Futures and Options (SFO) Magazine called one of the best trading books of 2009: High Probability ETF Trading: 7 Professional Strategies to Improve Your ETF Trading.
Larry Connors is founder and CEO of TradingMarkets.com.