I know after Tuesday’s green tape that traders may be quick to jump on the bull’s bandwagon, but this market is nothing short of scary.

I’ve been calling for aggressive selling and have even told my Trending123 and Parabolic Options members that things were looking like the Nightmare on Elm Street movie. From a very short-term perspective, unless the S&P 500 can sustain a push initially back through the 1,495/1,496 area, the focus will be on the 1,482/1,480 zone – a 50 exponential moving average (EMA) and a 38% retrace of the late December-February rally). I take a closer look at what the charts are showing us.

Video Transcript

High-beta stocks, small-caps, mid-caps – the winners of 2011 and 2012 are all starting to falter, and the previous losers, like the banks, have all done really well this year. The former winners, like Apple (NASDAQ:AAPL), have been trash this year. Let’s face it: They’ve been absolute garbage, so it kind of goes back to the trash of the past year or two, people are now dashing into in 2013. That doesn’t make a healthy market.

The leaders of the past several years since the 2009 bottom are breaking uptrend line after uptrend line after uptrend line, and it doesn’t really even matter if you look at the NASDAQ ETF (NYSEARCA: QQQ) chart and the possible head and shoulders top.

Or, look at the weekly chart of the NASDAQ Composite as I do in the video. Now, is it in a head and shoulders top pattern? No, but remember the rising wedges on the NASDAQ Composite’s chart at the end of 2012? Some things just did a little further of a backtest.

Is it fun to ride a backtest up when you’re in a short or a put? No, but does it really invalidate or change anything when you have 50 zillion different pieces of real technical evidence that various events will happen because every time in history it’s happened before and we’re having things come together that really haven’t happened before in a long time. That makes it a really, really scary market.

InvestorPlace advisor John Lansing tracks the charts all day and offers expert technical analysis in his day trading, options and trading services: Power Trading at the Open, Parabolic Options and Trending123.  For more information on which service is for you click here.