At the open, it looked like maybe the market could show some strength, but stocks quickly got absolutely demolished. Stocks from the watch list turned out to be better short than long selections. One long actually triggered. It was APA, but it sold off quickly.

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When it’s obvious we are in for a strong downtrending day, new longs should not be taken. Better to step aside and hold on to your money.

Although not on the watch list, this was a short recommendation last week, AUXL. Today it made its biggest downward thrust yet. That’s 9 down days in a row for this once strong performer.

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Momentum stocks move strongly on the way up, but can move even stronger on the way down. Check out how some of last months strong performers did today, like CMO, AKS and COIN. Truly the stronger they rise, the greater they fall.

In fact, metals are looking toppy, some metal stocks have already broken down considerably. If that continues, watch KGC, which looks poised to fall.

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With so many charts damaged, it will take months for stocks to build a base. Now is the time to step aside and look for stocks holding up that will lead the next market rally. Even in a bear market, stocks can rally.

The market is very oversold right now, and is due for as bounce. That doesn’t mean it will happen tomorrow, but we should get one soon. Here are a couple stocks to watch IF the market bounces soon:

 

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Good luck and good trading!