Sloppy Margarine or Smooth as Butter?

The main issue which intrigues me during this sell-off is whether we see margin calls (essentially forced, indiscriminate selling which often aligns with actual fear and panic as markets cascade lower) this afternoon into the closing bell, which of course is a function of brokers and risk management departments asserting themselves as markets become increasingly fragile. 

That said, I still maintain we are seeing fairly orderly selling at the moment.

While I recognize that statement may seem absurd to bulls and some of the traders who began in markets in recent years, the reality is that if you traded through markets before the pandemic--and especially before 2009--then you know the nonstop pattern of brief-pullback-followed-by-V-shaped-dip-buys-to-new-highs became a caricature of itself over time. 

Of course, markets over the (very) long run are practically designed to go higher. However, when stocks become seen as cute, fun, little piggy banks dispensing life-changing wealth in one fell swoop, as we have seen in recent years, history dictates that the eventual other side of the mountain will be equally as absurd. And that means thinking in terms of a sensible, smooth pullback which is to be easily bought, as many are (even seasoned veterans) requires an extraordinary leap of faith that all of the headwinds are overblown, virtually all at once. 

As you might imagine I am not in that camp. 

With the VIX still in the 20s (it usually reached at least 40 during memorable headline corrections, namely the Trump Tariffs this time around) and names like NFLX PLTR V still not budging much, it is hard to make the argument that markets are so disorderly as to be a contrarian bullish bottom. 

Let's see some margin calls first.