And IBD is usually spot on calling distribution days, follow through rallies, uptrends and uptrends under pressure. When market is in "correction", you want to be in 100% cash or if you have the dicipline short.
exerpts from tomorrow's IBD Big Picture Column:
"There is no telling how deep or how long a correction will be, only that this is not the proper environment to be in stocks. Be sure to sell any stock that falls 7% or 8% from your purchase price. The cluster of distribution days in the past few weeks, along with mounting weak action in the market leaders, was enough to conclude the market is now in a correction.
The Nasdaq has racked up five distribution days alone in the past three weeks. Plus, its Feb. 28 action marked a stalling day, which is another sign of professional selling.
Even prior to Monday's sell-off, the market action hadn't been so encouraging.
After selling off Feb. 22-23, the Nasdaq bounced back in weaker volume. The composite broke down again March 1 in higher volume. Turnover receded in the next two sessions as the index staged its latest bounce.
Also, take a look at the action in leading stocks. Many broke out from later-stage patterns or are extended from third or fourth rebounds off their 10-week moving averages.
History is not on the market's side. After major bear markets, indexes bounce back sharply, then pause for an intermediate correction before resuming their climb. But after two years of a bull market, the indexes tend to get choppy. Today's market is about at that point in the historical trend."
In summary, you really don't want to buy the dips of a market in correction. wait for a follow thru of 2% or more on higher volume than previous day 4-7 days after the initial rally attempt. This market could decline 10-25% or more before a follow through confirmation of a new uptrend. Be careful if you are long or own Mutual Funds or Hedge funds. It's very easy to switch to cash. Can always buy back at much lower levels. good luck to all longs cause you will need it as IWM heads back into the 60's or lower.