Good Tuesday morning. If I’ve learned one thing over my 4 decades it's that "Mr. Market" loves crushing as many investors as possible. He targets the majority, especially at extremes. Case in point; during the shutdown, just as everyone was worried about its impact on the markets, instead we had a near-parabolic move higher with Nasdaq jumping 5.2%. A classic “wall of worry” move higher. Then, once the shutdown was over, Mr. Market pulled the rug, with the end result being a 3-week 8% Nasdaq decline.

Mr. Market took us from extreme greed to extreme fear, as the Fear & Greed Index fell to “4” last Thursday, one of its lowest readings on record, along with the 2nd highest reading of put purchases in history. Mr. Market can be a brutal SOB but there’s one thing he’s consistent with; he rewards smart money PRIMARY trend following investors. The primary trend remained higher, even as the counter trend move lower shook out the weak hands.

That 3-week shakeout is over…that’s our cal...