Broad Market Decline Coming

I see the market averages at a very important pivot point right now with a high downward bias. We have seen strong opens get sold and lower volume on the days when the market closes up, strong indications that institutions are pulling money out of the market. The nasdaq tracking QQQQ have been in a severe decline ever since breaking down in early May. The S & P 500 tracking etf SPY looks a little better but is at strong resistance right now (below).
What does this mean? For one thing I would be very careful on the long side and preffer shorts. Staying out of the market entirely may be a good idea until new direction is found. Many would argue that when/if the fed pauses in their interest rate hike campaign the market will rally, but I would say that it is just plain stupid if the market rallies because the economy is doing so poorly that the fed has to stop tightening. If there is a pop I would be shorting into it and I bet many pro's would too. For that reason I suspect a fed pause to be just another case of buy the rumor sell the news. But this time sell the news then sell with both fists because we are headed into a economic slowdown.

GRMN behaved true to form an sold off all day friday until finding support at 85 at which time i exited my put position (at a nice profit). Then after rallying about 1.5 points they announced a 1.5M share buyback(on 110M shares outstanding which is nothing even when compared with the 1.9M daily average volume) and the stock ran into the close. My personal opinion is that this will present a great shorting opportunity next week when the stock tops out short of 100 (again). AS I said before the GRMN chart reminds me of HOM (now HSOA) just before it craterted 50%. More on GRMN later...

I like IOTN and MOVI long for earnings this week. They do not trade with the market. Happy trading!