Does that mean more declines lie ahead?
According to Dover Management CIO Doug Cliggott, the short answer is yes.
“The fundamental indictors seem to be deteriorating, he says, not bottoming. (He’s talking about things such as orders for non-defense capital goods, orders for consumer goods, hours worked in manufacturing etc.)
And don't don't hold your breath waiting for that to change. Cliggot says any turn in the market will take time. “The average downturn after the average financial crisis plays out over 3 or 4 years, and this is worse than average.”
So how should you trade?
“Long biotech and long healthcare,” Cliggott says. And stay away from everything cyclical.
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Trader disclosure: On Feb. 2nd, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour Owns (AAPL), (BAC), (EEM), (FXI); Macke Owns (DIS), (MS), (SDS), (MCD); Finerman's Firm Owns (DNA) & (DNA) Call Spread; Finerman's Firm Owns (MSFT), (XBI), (IBB); Finerman's Firm Is Short (IYR), (IJR), (IWM), (MDY), (SPY), (USO); Najarian Owns (AMGN) Call Spread; Najarian Owns (BMY) Calls; Najarian Owns (DRYS) Stock & (DRYS) Puts; Najarian Owns (EEM) Call Spread; Najarian Owns (FCX) & (FCX) Short Calls; Najarian Owns (GDX) Call Spread; Najarian Owns (MSFT) & (MSFT) Short Calls; Najarian Owns (MS) & (MS) Short Calls/Put Spread; Najarian Owns (V) Call Spread
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