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The action we’ve seen this week is typical for August, which has historically been the second-worst month of the year for the market. However, I don’t believe that the geopolitical tensions between the United States and North Korea are entirely responsible for the selloff.

In fact, the market has been unraveling now for several weeks, being that the only leaders have been some of the large-cap stocks in the Dow Jones. Market breadth has been deteriorating, and the S&P 500 has been underperforming, suggesting that we’re in for a longer period of corrective action going forward.

In addition, earnings have not been coming in as strong over the past week, whereas they were crossing the tape with much more bullish readings earlier this earnings season. Over the next two months or so, I think the market is in for a slow, choppy decline of 5%-10%.

In this environment, I’m looking to a particularly troubled sector for bearish profits: retail.

Buy to open the Buckle Inc (NYSE:BKE) Dec 12.50 Puts (BKE171215P00012500) at $0.70 or lower.

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