The stock market continued lower on Monday as all four major stock averages lost more than 1%.
The DJIA lost 178 points to close at 16,027 while the S&P 500 lost nearly 27 points to close at 1,853. The Nasdaq was lower by 79 points to finish at 4,284 and the Russell 2000 lost 16 points to close at 969.
On a positive note, the stock indexes closed well off lows of the day and they are setting up for a bounce higher in the next day or two.
The Nasdaq closed right at the bottom of its daily risk range. The Nasdaq will bounce higher off the bottom of its risk range before heading lower and breaking through the bottom of its range. That is a bearish trend signal.
In sum, there is absolutely nothing to be bullish about in this stock market. If traders and investors are looking to go long, they had better make the trades to the long side both short and quick. This is no time to be complacent and expect the markets to trend higher.
I am long the NUGT but am looking for a pullback from the extremely overbought daily signal.
Attached is a daily chart of the DUST showing an extreme oversold daily chart.
This article is commentary by an independent contributor. At the time of publication, the author held NUGT and DUST.