With all of the market turmoil, the sell-off is quite normal by historical measures. The Russell 2000 (small cap stocks) is down 16% from the high, the Nasdaq is down 13% from its high, the DJIA is down 12% and the S&P 500 Index is down 11%.
The weight of evidence for the cyclical trend remains bearish (see the various trade signals below). As it relates to long-term focused equity market portfolio exposure, remain defensive – sell or hedge the market rallies.