In This Edition... Market Update: Still Due For a Correction  Technical Trade Alerts: Harvard Bioscience, Encore Capital Group  Market Update: Still Due For a Correction One of the few things more bearish than an already-falling market is a market that's failed to follow-through on a rally attempt.  What's that got to do with anything? The S&P 500 gained 3.0% (out of nowhere) on Monday, was up as much as 0.7% on Tuesday, and then closed slightly in the red thanks to a late-in-the-day selloff. Same story today.... a supremely strong open started to deteriorate by 10:20 AM EST. Not exactly encouraging if you're a bull, as it's starting to look like one of those 'failed breakouts'.  I don't think it's any secret I've been on the bearish side of the fence in the short run; I have been since the May 4th edition. So far it hasn't mattered - good or bad - as the S&P 500 is essentially where it closed that on that Monday from two weeks ago. Still, I think this week's action so far merits an update of the outlook.  In short, nothing's changed. I still say the market's due for a correction, and I still contend it won't be the beginning of something so terrible that we all have to live in fear. On the contrary - it'll be a buying opportunity. Just to be clear though, it should also be a little more than a mere bump in the road. By my figuring, the S&P 500 could slide another 8.0% (to 830) before the bulls have been adequately humbled.  If you're wondering why, the 830 level (829.7, technically) is where you'll find a key 38.2% Fibonacci retracement line.  I don't necessarily think the market has to make said correction by making a beeline to those target levels though.  We already got some whiplash after the 4th with a really sharp pullback of 5.5% from peak to trough. Since the 15th (Friday), we've been as much as 4.5% above that trough low...in just three trading days. Point being, both the bulls and the bears are still scrappy, and both sides can still pack a punch. In the end though, I think the bears just have a little more punch left than the bulls.  The reason I say this is just to make sure you're aware it could take a few more days to come to fruition. The SPX may need to retest 930 one more time - as it did last week - before the bottom falls out. Patience. In the meantime though, make your plans. Put the symbols on your watchlist now, set your targets now, and free up some trading capital now. Then when the time comes, there'll be no hesitation.  As for my bearish entry triggers, I've got two possibilities.  The first one is a move to or above 930. I'll be selling or shorting into that strength on faith that the bears have more gas in the tank than the bulls.  My second trigger will be a move under the 20 day moving average line, currently at 891. Some of the indices fell under this key moving average last week, though the S&P 500 didn't. It's been a major line in the sand all the same though, so I'm not going to press my luck with it.  Obviously the former possibility offers a much greater 'swing' move than the latter, but we don't get to choose - we only get to trade what presents itself.  I'll stay in touch as much as I can regarding this set-up.    New Trading Ideas We're going to continue pairing up bullish (long) and bearish (short) ideas as the market makes its way through this pivotal time. At the very least we're likely to win with one of the trades, and possibly both. Harvard Bioscience Inc. (HBIO)  This stock actually popped up on my bullish radar on Friday when volume surged 30 times more than average, yet on no news - not even a rumor. I ended up dismissing it as a one-day fluke, thinking the market could have meant to buy another stock and just got the ticker wrong (yes, it happens). Then a funny thing happened. Though the stock pulled back to its starting point on the high volume day, since then HBIO has started to chip away at resistance again, and volume is staying strong. Yet, still no explanation. I usually don't like to jump in on something that 'might' happen, but I think there's something significantly bullish going on here that we just don't see. We've just seen too much volume behind this breakout effort to ignore it. As for where it could end up if it takes off, we don't provide targets. If we did though, I think a retest of the previous plateau around $5.00 would make sense.  Encore Capital Group, Inc. (ECPG)  There's nothing particularly wrong with Encore Capital Group. The P/E is relatively low, and the forecasts are encouraging (in addition to almost being believable). You could definitely do a lot worse than 'investing' in ECPG. However, this isn't an investment - this is a trade, not intended to last more than a few days, or perhaps a few weeks depending on the pace.  ECPG shares are overbought right now thanks to a ridiculous run from $3.00 in early to $12.00-ish area now. Once the wall was hit on May 11th, we've watched this stock walk its way into a wedge-shape. That wedge, however, is about to come to a close and force these shares out of it - one way or another.  Given how overbought the stock is, we suspect the support side of the triangle shape (the lower edge) will be the one that breaks, leading to a pretty good downside move. There's just too much profit-taking opportunity built in right now for current owners to let it slip away. As with all short trades, where the risk is theoretically infinite, safety is critical - set a proper stop. You can see similar trading ideas (new and old) right here.    The Run-Up in India Spotlights Indian Small Cap Stocks Monday and Tuesday , stocks of every cap size on every exchange in the world, from the Berlin Exchange to the Hang Seng went ballistic if they had anything to do with India. U.S. ADR's (American Depository Receipts) and publicly traded issues followed suit on the news that this weekend's electoral victory in India by the dominant Congress Party.  On Sunday, the Congress Party won 262 of 543 parliamentary seats, putting the party that backs economic reform on its way to a majority.  While trading was halted Monday for a brief time so everyone could catch their breath, the trading day itself set a landmark and reminded everyone of India's potential as its government turns inward; improving roads, revamping education, and choosing where to place economic subsidies and stimulus.  Tuesday, lots of profit taking. But the overall sentiment is much like an active day on the NYSE with buyers and sellers moving in and out and option traders around the globe now have a chance to participate with some 'designed intent' as the intoxication of the election wears off. You can read the rest of the storyat our new community pages.       Will India's Party Spread Global Good Cheer? Emerging Market Small-Caps May Catch the Fever They were partying in the streets of India Monday, celebrating the Congress Party-led alliance's victory that boosted the Indian stock market 17%. Some of that enthusiasm spilled over globally and to other regional markets. Many see this sigh of relief in India as an impetus for overall emerging markets.  Others point to signs that growth had picked up in China over the past month as commodity prices rose, as did sentiment for emerging markets. That said, here's a trio of small-cap stocks, poised to rally along with emerging markets.  With airlines folding left and right and serious transportation shortfalls worldwide, bulk-ocean shipping is thriving today and should for a long time to come. As a major transporter of iron ore, coal, grains, bauxite, fertilizers and steel products, Athens-based Star Bulk Carriers Corp. (NASDAQ: SBLK) should persist well into the relevant future. Greece has long demonstrated a comparative advantage in this arena.  Based on expected world growth and ongoing exporting and importing needs, shipping will be a transportation mainstay for years to come. World GDP growth is expected to plug ahead 3% this year.  Read the rest of the story at the new Small Cap Network community pages.