You know, we've certainly got plenty to talk about today, with the market tanking the way it did. Before we get to our usual chat though, I want to give a quick shout out to the guys over at the Elite Opportunity who have just been phenomenal of late. Honestly, I knew the EO's long-term portfolio had done quite well since the mid-October low (and even before then), and was holding up nicely even though the broad market has started to struggle over the past few days. I didn't really recognize just how solid the Elite Opportunity's long-term portfolio was, however, until John Monroe laid it out in today's newsletter. Check it out. Based on today's current prices, the EO portfolio's combined pick-return of the six winning stocks in its ten stock portfolio is 115%. Conversely, the combined pick return for its other four holding is only -23%, with only one of those four being responsible for the bulk of that 23% loss. Folks, in this environment, that's phenomenal! Those are the kinds of returns most hedge funds can only dream of. If you need some help getting your arms around the math of John's average gain, this might help. The average gain for each of the ten open trades in the Elite Opportunity portfolio right now is a beefy 9.3%. Again, that's outstanding by most any standard. We're talking better than the typical hedge fund! The real show-stopper for me, though, isn't the number of big winners John Monroe is capable of finding. It's the speed with which his picks move. Not one of the ten open trades he's got right now was picked before June, and most of them have only been added since October. What this means is, Elite Opportunity members haven't had to keep their money tied up forever to enjoy these big gains. They can quickly deploy their gains into other winning trades, and repeat the process over and over again. It's sure not the kind of snail's pace of progress your average mutual fund sets with your money. Anyway, kudos to John and his team. That being said... If your portfolio has been a little shell-shocked over the past three or so days, this might be the exact time to try out the Elite Opportunity service. It's kind of funny, but not in a ha-ha way. It's funny more like in a surprising, ironic way - though traders and investors tend to clamor to become an EO member when the market is rallying, the time John can provide the most value is when the market isn't doing so well, like now. See, when the market is weak, tepid, or confused, traders have a tendency to do things that make sense at the time but often end up not working out so well. John Monroe, however, has been through these bearish patches umpteen times and knows how to navigate the environment. More specifically, he knows how to navigate you through this environment. If you're already frustrated about the market's recent volatility or worse, if you're nervous about what's to come now that the bears have fired some warnings shots, THIS is the time you really need an expert in your corner. Here's how to become an Elite Opportunity member, or cut and paste this link: https://www.smallcapnetwork.com/pages/SCNEO/v1/ . Don't tarry either, because I've got a feeling the next week and a half are going to be wild. OK, movin' on. Prepare to Get Wet Wednesday's weakness was pretty much what I expected in Tuesday's newsletter ("the bulls made a great showing today. I'm still on the bearish side of the fence though, and am going to assume Tuesday's rebound was anomaly"), though the size and scope of Wednesday's selloff was once again annoyingly overdone. I've complained about this before, but it bears repeating now - the bears would be far better off pacing themselves rather than throwing everything out the window as quickly as they can over the course of one day... like today. These big one day pullbacks just set up a strong buyback, and it often materializes the very next day. Problem is, those buybacks can also be one-day wonders, leaving traders confused as to which direction the market is actually pointed. If the market could just sink a more modest 0.5% per day, it could do that as long as it wanted to and the bargain hunters wouldn't put up a fight for a while. As it stands after today's 1.6% dip, the bargain-hunters are already sniffing around again. Be that as it may, I think we have to interpret today's (and Monday's) action at face value and assume the bears are taking control. I'm going to feel the same way on Thursday too, even if we do get some good-looking bullish action. I want to start today's analysis with a look at the weekly chart of the S&P 500 just because it offers some needed perspective. What I want you to notice on the weekly chart is (1) in the grand scheme of things this pullback so far isn't something we haven't seen and survived before, and (2) the VIX is almost back to a key resistance level around 21.0. My point is, the 100-day moving average line (gray) is still in a position to stop the bleeding around 1990, and the VIX could easily also flag an important bottom for the market if it bumps into and then peels back from the 21.0 level. I'm not absolutely guaranteeing this is going to happen, of course, but I will guarantee you I'm not going to freak out on a major way until the 1990 levels fails as a floor and the VIX moves above 21.0. Now with that perspective in the back of your mind, let's take a look at the daily chart. It's plain to see here the S&P 500 not only broke under the key floor at 2052 but also broke under its lower Bollinger band line at 2025. It also sold off on the highest volume we've seen since the October plunge. In fact, this whole thing is looking a lot like the October meltdown. Scary (a little). You know what though? As bad as today was for the market, the Russell 2000 still hasn't moved under the line in the sand we drew at 1152. And, I want to draw a line in the sand at 4674 for the NASDAQ Composite, near where it hit lows yesterday and today. My guess is we'll get something of a dead-cat bounce on Thursday, but it won't be enough to jolt stocks back into an uptrend; the market just looks too vulnerable now for investors to pile back in. Once any kamikaze bulls plow in, I can see the bears taking control once more and this time pulling all the indices below all the short-term floors we talked about above. It remains to be seen if it's going to turn into something bigger than just a short-term blip, though I'll just point out this is what the October selloff looked like when it first got going. It's kind of like a hole being poked in the bottom of a fishing boat. It doesn't look that bad at first, and there's even a short period there where it seems like you can plug the hole with your foot and keep rowing. The longer you stay in the water though, the clearer it becomes that you can't do a thing about it even though you see the whole thing coming. Sooner than you expected, you're swimming back to shore. After today, stocks now have to play it all out. That's how I see it anyway. If a more significant stumble is in the cards we'll start with a floor at 1950 for the S&P 500, though that's just a checkpoint. I still contend we're due for a more serious correction... the kind that makes people think we're entering a new bear market (even though we're not) based on exuberant valuations. This isn't really the time of year to expect a lot of market weakness though, so I'd be willing to bet stocks can stave off that setback through the early part of next year. But, let's cross that bridge when we come to it. In the meantime, don't forget this is the kind of tricky environment where expert advice like that offered by the Elite Opportunity's John Monroe is crucial to have in your arsenal. Go here to see all your subscription options, or cut and paste this link: https://www.smallcapnetwork.com/pages/SCNEO/v1/ .