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While I’m certainly bullish on industrial metals, my indicators are giving bearish readings, and the action we saw last week is starting to reflect that. While the major indices are not that far away from their all-time highs, there are a few sectors that are in their own bear markets right now, such as energy and retail.
If this persists, we’re likely to see some further downside action until at least the end of September, so I’m now firmly in the bearish camp. The market’s internals have been unraveling for a while now. Although the “FANG” stocks are holding up, overall market breadth has been weakening, so Thursday’s selloff was not entirely surprising.
The legislative situation in Washington D.C. is also not looking as good for the market, as health care and tax reform seem to be off of the table for now.
So, overall I’m not overly enthusiastic about stocks, and today I’m recommending a bearish trade: puts on Johnson Controls International plc (NYSE:JCI).
Buy to open the JCI Oct 35 Puts (JCI171020P00035000) at $0.70 or lower.
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