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Is this a minor correction, or something bigger?

By Lawrence G. McMillan

$SPX has finally broken down somewhat and sell signals have arisen in many areas. This has been enough for us to declare our “core” position as bearish, but the bulls still have a chance to rescue things. To the media, the reason for the selling is mainly the coronavirus, or perhaps earnings, or maybe Boeing, but in reality the market was so overbought that any reason for selling was going to cause some decline.

The question now is, can the bulls halt this at levels that would be considered a minor correction, or is something more on the order of February 2018 going to unfold? We can’t predict the future, but we can ride the trend and stay in line with our indicators....

This Market Commentary was excerpted from this morning's edition of The Daily Strategist Newsletter. Sign up for The Daily Strategist Newsletter

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