What Is With The Monday Selloffs?

Do you find it interesting that both last Monday and today the market experienced nasty selloffs? Of course, last week the market found its footing and finished higher for the week. Could it happen again?

The selloff today hit everything. The SPX fell -1.8%, the COMP fell -2.2%, and the small-caps (RUT) fell -3.2%. Pretty nasty. Volume rose on the NYSE, making for another distribution day. And we never did get the strong follow-thru rally I was looking for (although last Tuesday's rally came close).

Breadth was bad today, with 90% of the volume on the NYSE to the downside. On the positive side, this is the type of exhaustive selling often seen at market bottoms.

This is what makes market bottoms so difficult. There are often several violent shakeouts at the bottom that rattle most investors' confidence. But I think when we look back at this period on the charts, we will likely be able to point to a decent buying opportunity. I am still net long, but not yet really net long.
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