Some of the worst market action has occurred during the month of September. Statistically, it is the worst performer of the twelve in the calendar. Fresh in our minds is the 2008 financial crisis, which started to show cracks early in the year but this week we 'celebrate' the seventh anniversary of the stock market being brought to its knees. It was a sobering time for all involved, not a stock left unscathed by the carnage of a precipitous drop in the indices. The selling was so intense due to the high level of uncertainty, the volatility index (VIX) climbed well over 90% for the first time ever (some say the 1987 crash would have had a reading of 150 but it was not in play back then).
For all it's worth, September is often a time for re-allocation, earnings revisions and to give an outlook for the coming year. To be sure, 2015 has been one huge challenge, and with the chart setups there is no easy path. I call sideways action bearish, and since late Spring this market has been under severe distribution, though it has not always been reflected in the indices. This market continues to trend in a bearish fashion, as it has all year long.
After the worst month (August) than we can remember, September is the month where we should be able to get a handle of the path for the next timeframe. A down month in September likely cements the bearish argument even further. And that's okay, all markets run in cycles.
Some view October as being worse, since that is the most 'ominous' month where stock market crashes have occurred. Historically, that is correct but when markets crash and prices are 'washed out' that often opens the door to new bull market trends. Those catastrophic drops in 1929 and 1987 (others followed but were not as pronounced) were low marks and were often not tested again. So, while we could see some wild price action over the coming weeks it could bode well for the long term future.
The end of a bull market tends to utterly confuse everyone, and most miss out on making money on the bear market because they were too late to get on board - and it is over before you realized it was happening. Some will just sit tight and others will try and buy the dip, which is when that 'trick' won't work any longer. Let the action play out, stay lean and mean, don't overtrade and wait for the right opportunity, never wanting to be the first one in the pool. Let the others take a stab at it, while you wait for your fat pitch.