SPY IS ON A PATH FOR MORE DOWNSIDE –

At lease the odds say we are. We flagged SPY as overbought on Friday and indicated to watch the next day to see if more downside is possible. Well SPY closed down -.50% yesterday which is a good sign for the bears. If you look at the chart below you can see that over the next3-8 days, it can get very red with an average decline of 2%.

In fact 67% of the time the market was down over 1% by day 3, 72% by day 5, 66% by day 8 and 61% by day 10

We are still currently holding an SPXU position, with stops now above yesterdays open, our road map to make sure we are seeing a 1% to 2% decline over the next few days.

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