The market action today was a good example of how a bad market doesn't scare you out, it wears you out. The selling was steady and relentless and there was never a surge in fear or emotion to help a washout bottom form. The selling even accelerated late in the day on news that President Trump would be discussing automobile tariffs tomorrow.
What is most worrisome about this action is that there really is nothing to signal that some good support is about to form. The only real support levels are the recent lows and there was nothing to suggest that we are hitting an emotional extreme despite the large point loss and the terrible breadth.
The bad news is that there just isn't any reason to believe that the worst is over. Market players are growing weary and disgust levels are high but there isn't anything to indicate it is extreme enough to be a useful contrary indicator.
If you are looking for a positive spin the best thing that can be said about this action is that many individual stocks are being unfairly sold and are becoming attractive values but that doesn't mean that they won't sell off further.
The best course of action is to get out of they way, protect capital and stay patient. Your goal should not be to predict the market low but to start entering positions when they have the best chance of sustained upside.
Have a good evening. I'll see you tomorrow.
