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Eventually Buying The Dip Will Not Work

Last night, there was more evidence of a slowing Chinese economy. The HSBC flash manufacturing PMI for China declined to 48.1 in March compared to 49.6 in February. Any reading below 50.0 indicates economic contraction. A slowing China is certainly problematic for the global economy. Earlier today, Germany also reported weaker economic data and this is the likely catalyst for the small decline in the markets today before the opening bell. This morning, the S&P 500 Index e-mini futures (ES-M2) are trading lower by 7.00 points to 1390.50 per contract. Traders and investors are now becoming accustomed to buying every morning dip when the futures decline before the opening bell. This buy the dip reaction by traders is much like Pavlov's law, however, one day this trade will no longer work. ...Continue reading here: