The S&P broke higher from yesterday's tight range, but it gave up ground by the close. Watch for a snap break of Wednesday's low, this would again off a short play - but the stop would be placed above 1,882. Until then, the long side of the market is the place to be.
The Russell 2000 lost ground, which gives shorts a slight edge, but keeping a tight stop on a move above 1,210 would remain prudent.
The Nasdaq is ascending in a very tight channel. Bulls are best placed to benefit as shorts may find it a little harder (given semiconductor strength) to get enough momentum on any downside break.
The long term prospects for the Nasdaq and Technology Stocks looks good. In the near term, the upside break in the S&P remains close enough to yesterday's tight action to offer a snap short trade should Wednesday's lows be undercut.
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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
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