It is well known that the Monday following Thanksgiving has a negative bias so it is not a big surprise that pre-market strength didn't last long. The dip buyers are standing aside as sell stops are triggered and the selling finally gains some momentum. There is no obvious catalyst for the selling other than the extended technical conditions.
Breadth isn't too bad so far with about three gainers for every four sellers but the number of new highs has dropped to around 150. What we have to watch for now are failed bounce attempts. Downtrends are largely a function of failed bounces and lower lows.
At this point, it is particularly important to stay disciplined. I have tight stops on positions and I'm letting them trigger. My cash levels have been too high lately but that is helpful today. I have some index shorts in the form of ProShares UltraPro Short S&P 500 (SPXU) and will be a bit more aggressive in trading that now.
There is no way to know if this is the start of the deeper corrective action that the bears have been incorrectly predicting for months and weeks, but the price action says to be more cautious so that is what we need to do.
There are a few things on my screens that are working but the momentum names are taking some hard hits and that demands attention. Focus on keeping accounts as close to highs as possible and don't worry too much about what happens next.
Gold miners are on my radar this morning and I'll have more comments on the group later.