![](\"https:\/\/www.jeffclarktrader.com\/wp-content\/uploads\/2017\/12\/Screen-Shot-2017-12-06-at-11.25.46.png\")
<\/p>\nIt\u2019s hard to be bearish in December. This is normally a good time of the year for the stock market.<\/p>\n
And come on \u2013 nobody wants to be the downer at the holiday parties.<\/p>\n
But the more I look at things, the harder it is for me to be bullish.<\/p>\n
Stocks reversed off of a euphoric move higher last Friday morning. They did the same thing on Monday. Then, after being up as much as nine points yesterday morning, the S&P 500 reversed course again and closed 10 points lower.<\/p>\n
It seems December isn\u2019t starting off all that jolly.<\/p>\n
Semiconductor stocks, technology stocks, and the FANGs (Facebook, Amazon, Netflix, and Google) \u2013 which all led the market all year \u2013 are now lagging badly.<\/p>\n
And banks, which took up the leadership role as tech stocks rolled over, now look super extended and vulnerable to at least a modest pullback.<\/p>\n
Yet\u2026 for all of these concerns\u2026 the S&P 500 is still only down about 1% from its all-time high. So, what am I worried about?<\/p>\n
Let me show you the one chart I update several times each day\u2026<\/p>\n
<\/p>\n
This chart of the iShares iBoxx High Yield Corporate Bond ETF (HYG) still looks bearish to me. It\u2019s been bumping into the resistance of its 50-day moving average<\/a> line for the past couple of weeks. And it just hasn\u2019t been able to overcome resistance.<\/p>\n Now, it looks as if HYG is on the verge of losing the support of its 9-day exponential moving average<\/a> line. That would be a bad sign, and would likely spark the start of a move down to retest the mid-November low.<\/p>\n And as we\u2019ve pointed out several times<\/a> over the past few months<\/a>, if the junk bond market starts selling off, then the broad stock market won\u2019t be far behind.<\/p>\n For the moment\u2026 there\u2019s nothing to worry about. And like I said, it\u2019s hard to be bearish in December.<\/p>\n But, if HYG starts breaking down, then it\u2019s going to be really tough to be bullish.<\/p>\n Best regards and good trading,<\/p>\n Jeff Clark<\/p>\n A real mixed mailbag for today, full of unique insights from <\/em>Delta Report subscribers\u2026<\/em><\/p>\n I would like to humbly offer the following:<\/p>\n “Time and patience are the two greatest warriors.” \u2013 Leo Tolstoy, War and Peace<\/em><\/p>\n Please use at your discretion, when and where you deem appropriate.<\/p>\n You are an honorable person and that makes you very special and me most fortunate. Thank you for your common sense, reason, and most of all your discipline. Warmest personal regards.<\/p>\n \u2013 Richard M.<\/strong><\/p>\n<\/blockquote>\n <\/p>\n I’m pleased to patiently wait for the next great low-risk trade you\u2019re able to locate…<\/p>\n I\u2019ll be tickled if you can manage to find just one more this year. But if it\u2019s not there, it\u2019s just not there and that\u2019s OK with me.\u00a0Keep up the great work!<\/p>\n \u2013 Keith A.<\/strong><\/p>\n<\/blockquote>\n <\/p>\n My best friend (a CIA-trained chef \u2013 no, not that CIA) and I started and ran a very successful restaurant for many years. The hours were too much for me so I began another career and he remained in the business and owns multiple successful restaurants on Long Island because he loves what he does.<\/p>\n I remember having to deal with the whiners and the \u201cnattering nabobs of negativity\u201d which was part and parcel of the industry. Using an example number of 200 dinners we could serve on a particular night, 198 patrons were wowed and 2 were not. The 2 would proceed to tell everyone (and me) of their \u201cbad\u201d experience and the other satisfied customers would stay relatively quiet.<\/p>\n The point is, I have made money on every trade since I have subscribed. The most surprising one was HOG. I ride (Triumph America) and knew that Harley\u2019s best days are behind them (electric bike? talk about not knowing your customer!). I waited for the earnings which I correctly guessed was less than stellar and bought the call options, low only on your faith of a positive response to negative earnings, which proved out. I sold on my own and made a handsome profit.<\/p>\n I appreciate your musings on the market and the directions you are leaning towards. I totally agree with waiting for the right setup. Keep up the good work and remember the silent majority are satisfied and that it is a real thing. Thanks.<\/p>\n![](\"https:\/\/casey-assets.s3.amazonaws.com\/images\/misc\/jeff-clark-signature.png\")
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