The bond market has an ominous message for stocks.
High-yield bonds, which typically lead stocks, are in the midst of a selloff. The two largest junk bond ETFs, the SPDR High-Yield (JNK) and the iShares USD High-Yield (HYG) are both down about 3 percent year to date. But according to some traders, the pullback is nothing to worry about.
Gordon said the market has seen several bad signs lately, including a selloff in commodities, transport stocks and Chinese stocks. However, he said none of these has reversed the upward trend in equities, but has only brought stocks back down to the moving average.
"The stock market has merely done a mean reversion," Gordon said. "The moving average has been rising, 2015 has been consolidation with no real downside movement."
According to Gordon's chart, HYG is nearing a support level created in reaching a double bottom of about 86. The ETF fell 0.4 percent to 86.88 on Monday.