The day started well (for bulls) with some early follow through upside, but it wasn't long until bears were trying their hand again.
The S&P may have registered a channel breakdown. There was a close below channel support, although the day's low did not violate the low from yesterday. There was a marked rise in volume, confirming distribution.
Morning action left the Russell 2000 staring at a new swing low, and the S&P at a channel break. However, buyers returned in the afternoon to return the S&P to support and the Russell 2000 scrambling back to its 200-day MA. Meanwhile, the Semiconductor index finished with a bullish doji on the 50-day MA. Given bears failure, bulls have an opportunity to press their advantage in the Semiconductor Index and S&P.
The 608 low in the Semiconductor Index may see a test and perhaps an intraday violation, but there is a fairly decent long side opportunity available, if the 50-day MA can hold.
Bears made further inroads to the Semiconductor index, and Russell 2000, which delivered knock on results elsewhere. The Semiconductor index had the worst of the action, slicing through its 50-day MA with a near 2% loss. If bulls wanted value a quick return above the 50-day MA would set up a 'bear trap' and may generate enough juice for a challenge of 650.
Other than a slight uptick in volume for the S&P, it was a relatively quiet day. The one index which hinted at a change was the semiconductor index. It had been trading in a sideways range which had drifted outside of its narrow, rising channel, but yesterday's close positioned it as a break of support. The 50-day MA is nearby to provide support, but with technical weakness expanding there is a strong possibility for a larger move down.
No posts for the next couple of weeks. Trading volume was light with tight action in Large Caps, but a little give in Small Caps. Existing trends in play until proven otherwise, anything else risks overplaying background noise.
Pointers to keep an eye out for over the coming weeks:
S&P remains on course to tag the 10% 200-day MA envelope (grey dashed line). Channel and/or 20-day MA support may offer pullback opportunities.