The more negative market sentiment becomes this week, the more likely stocks will bounce again, even if only for a few days.

Deron Wagner's plan is still to initiate new short positions into strength of any weak ETF's that bounce into major resistance levels.

The U.S. Oil Fund (USO) is setting up for short entry.

It's quite possible the volatility and indecision stocks have experienced over the past few days is the market's way of trying to find a near-term bottom.

Stocks are again trying to bounce off their lows, but there are not yet buyable patterns that excite Deron Wagner. Instead, he's more inclined to wait for the bounce to move into major levels of resistance, then initiate new short positions again.

The most likely intermediate-term market trend is for stocks to enter into a sideways range, perhaps with the February 2010 lows as lower channel support.

As for long setups, Deron Wagner thinks there are very few ETF's to consider at current prices because he doesn't enjoy catching falling knives

Based on pre-market futures action, the S&P 500 is now poised to open about 1% below its 200-day MA. The ability or inability of the index to recover and close above its 200-day MA in today's session will have a pivotal role at determining the market's next move.

Momentum from Monday's bullish intraday reversal abruptly fizzled out yesterday, as stocks resumed the bearish trend from the latter half of the previous week.