Buying a soft open on Monday morning used to be a 'no brainer' trade. It was so routine that the dip would barely have an opportunity of forming before the buyers would go to work.
We are now seeing the opposite side of that phenomenon. Even though there isn't any new negative news surprise and despite the very gloomy mode, the dip buyers are now afraid to pounce on the open. They have no confidence that there are a sufficient number of buyers, human or computers, to reverse the market.
Contrarians might argue that it is a positive that the rush to buy weakness has ended. It allows the bullish excess to be totally destroyed and for a complete washout to finally occur. We actually are now seeing a second bounce try after the first one failed which is what the contrarians would likely be looking for.
There are three main problems so far today. Financials, oils and Apple (AAPL) . Apple has been the market's biggest sore point lately as many other stocks have already corrected deeply and are finding support. Apple can't seem to find support yet which is pretty surprising how well loved it was for so long.
The negative sentiment surrounding Apple is probably the most positive contrary indicator the market has right now. The stock that was viewed as untouchable, and even had the blessing of Saint Warren Buffett, can't find support and is subject to new valuation downgrades seemingly every day.
If you want to use a contrary approach and try to catch a bounce in this market then focus on the worst action. When Apple, banks and oil find support it will be time to look for some sort of relief rally.