{"id":26786,"date":"2026-04-03T07:30:00","date_gmt":"2026-04-03T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=26786"},"modified":"2026-04-02T13:56:33","modified_gmt":"2026-04-02T17:56:33","slug":"this-bear-market-signal-has-an-11-for-11-track-record","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/this-bear-market-signal-has-an-11-for-11-track-record\/","title":{"rendered":"This Bear Market Signal Has an 11-for-11 Track Record"},"content":{"rendered":"
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Managing Editor\u2019s Note:\u00a0<\/strong>Keith Kaplan \u2013 CEO of TradeSmith \u2013 is going to tell us about an evidence-based indicator that TradeSmith subscribers can use by following a clear, traffic-light-style signal.<\/p>\n

It\u2019s built around the simple observation that every asset has a normal range of movement.<\/p>\n

Whether it\u2019s a stock, ETF, or commodity like silver or gold, every asset develops a well-defined rhythm of ups and downs.<\/p>\n

And all you need to know is if the stock is in one of three zones: Green, Yellow, or Red.<\/p>\n

Check out how it works below \u2013 and how it eliminates human emotion from trading\u2026<\/p>\n<\/div>\n

This Bear Market Signal Has an 11-for-11 Track Record<\/h2>\n

BY KEITH KAPLAN, CEO, TRADESMITH<\/strong><\/p>\n

At 10:55 p.m. on April 14, 1912, a radio operator aboard the SS Californian<\/em> tapped out a warning to the RMS<\/em> Titanic<\/em>.<\/p>\n

The Californian<\/em>, just 20 miles away, was stopped for the night, surrounded by ice.<\/p>\n

The chief radio operator on the Titanic<\/em>, Jack Phillips, had already passed several ice warnings to the bridge that day. But by late evening he was buried under a backlog of passenger messages.<\/p>\n

One first-class traveler wanted to tell friends about an upcoming poker game in Los Angeles. Another needed to reach his broker in New York.<\/p>\n

So, Phillips sent back a signal to stop transmitting and went back to sending the passenger messages. Thirty minutes later, the operator aboard the Californian<\/em> switched off his set and went to bed.<\/p>\n

At 11:40 p.m., the Titanic<\/em> struck an iceberg. The hull buckled along 300 feet of her starboard side, flooding five watertight compartments.<\/p>\n

The \u201cunsinkable\u201d ship was designed to stay afloat with four compartments flooded. But not five. At 2:20 a.m. \u2013 2 hours and 40 minutes after impact \u2013 she sank beneath the surface.<\/p>\n

Last December, in these pages, I sent out a different kind of warning.<\/p>\n

Along with Wall Street legend and fellow quant investor Marc Chaikin, I warned that 2026 would be a \u201ctipping point year\u201d for the stock market.<\/p>\n

And for the first time since becoming TradeSmith CEO, I urged you to set aside our Long-Term Health stops and rely on our more sensitive Short-Term Health stops instead.<\/p>\n

There are still long-term reasons to be bullish on stocks \u2013 prime among them the AI boom. If the war with Iran ends soon, it could once again become investors\u2019 primary focus.<\/p>\n

But we can\u2019t ignore what the market data is telling us.<\/p>\n

The tech-filled Nasdaq 100 entered a Short-Term Health Red Zone on Feb. 27. Since that signal, it’s fallen as much as 8%… and is now down 8% from its October peak.<\/p>\n

And judging by the deterioration we\u2019re seeing in the other major U.S. \u00a0indexes, it\u2019s part of a wider bearish trend.<\/p>\n

So today, I\u2019ll show you what our indicators are telling us right now \u2013 and why the picture they’re painting is one every investor needs to see.<\/p>\n

I\u2019ll also introduce you to a tool I\u2019ve never written about in these pages before. It\u2019s a bear market signal with an 11-for-11 track record going back nearly 40 years.<\/p>\n

It\u2019s never missed a major crash. And right now, it\u2019s watching for what could be Warning No. 12.<\/p>\n

The Traffic Lights Are Turning Red<\/h2>\n

The best way I know to take the temperature of the market is to look at our Short-Term and Long-Term Health indicators.<\/p>\n

Think of them as a traffic light system. Green means a bullish trend is intact, and it’s a safe buy. Yellow means caution \u2013 the trend is weakening, and it’s worth watching closely. Red means the trend has broken down, and it’s time to sell.<\/p>\n

As I mentioned, the Nasdaq 100 \u2013 which led the tech-driven bull market higher \u2013 has been in a Red Zone for more than a month.<\/p>\n

And the S&P 500, a broad measure of the U.S. market, has joined it in the Short-Term Red Zone. So has the Dow, which tracks 30 of America\u2019s best-known blue chips.<\/p>\n

Critically, the Dow has also entered a Long-Term Health Red Zone, meaning the deterioration isn\u2019t just a short-term wobble. It\u2019s showing up in the longer-term trend.<\/p>\n\n

\"\"<\/figure>\n\n

In short, our market health signals are breaking down across the board.<\/p>\n

And that means caution is the name of the game right now. Despite the fundamental reasons to be bullish on stocks, we have to respect these market health signals.<\/p>\n

A Dilemma Every Investor Faces Today<\/h2>\n

But here\u2019s the problem with jumping out of the market at the first sign of trouble. The biggest gains in a bull market often come in the final innings \u2013 right before the turn.<\/p>\n

Sell too early, and you leave serious money on the table. Stay in too long, and you give it all back.<\/p>\n

The problem isn\u2019t getting out. It\u2019s staying in long enough to capture the gains while being nimble enough to exit before the damage hits.<\/p>\n

This is what hedge fund legend Paul Tudor Jones was getting at when he compared today\u2019s market with the dot-com bubble that blew up in the late 1990s. As he told CNBC last October\u2026<\/p>\n

If you don\u2019t play it, you\u2019re missing out on the juice. But if you do play it, you have to have really happy feet, because there will be a really, really bad end to it.<\/p>\n

It\u2019s a real dilemma: Stay invested, and you risk riding the market all the way down when it turns. Get out early, and you miss the gains that are still on the table.<\/p>\n

At TradeSmith, we\u2019ve spent years trying to resolve this dilemma. And I believe we\u2019ve cracked it.<\/p>\n

My team and I have created a signal I\u2019ve never shared before \u2013 one that has flagged every major market crash and every major market recovery since 1987. Eleven for eleven. No misses.<\/p>\n

And right now, it\u2019s watching for Warning No. 12.<\/p>\n

These Bearish Patterns Are Showing Up Again<\/h2>\n

The patterns it detected before every previous crash \u2013 the same breakdown signals that preceded Black Monday, 2008, and Covid \u2013 are starting to show up again.<\/p>\n

And I want to make sure you’re prepared.<\/p>\n

If you followed my advice at the end of last year, you\u2019d have done three things:<\/p>\n