Tuesday, May 05, 2015

Riding Support in S&P, But Nasdaq Breaks

Sellers took control of markets with the Nasdaq following prior weakness in the Russell 2000 with a breakdown. This just left the S&P trading at support with very little room for maneuver if bulls don't make an appearance tomorrow. Volume climbed in confirmed distribution and there was a 'sell' trigger in the MACD.


The Nasdaq was less fortunate with a clean slice through trendline support. There was also a 'sell' trigger in On-Balance-Volume. There is still a chance for bulls to trap shorts tomorrow, but there is work to do for this happen.


The Russell 2000 had already lost channel support, and it took a swing at a further leg lower on today's loss. Next support is found at 1,206 and 200-day MA.


Tomorrow could see an acceleration of losses as bears look to crack the S&P. If shorts/sellers fail to do so, then look to the Nasdaq to build a bullish revival.

You've now read my opinion, next read Douglas' and Jani's.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com, and Product Development Manager for ActivateClients.com. I do a weekly broadcast on Friday's at 13:30 GMT for Tradercast, covering indices, FX and gold, silver and oil - all are welcome! You can read what others are saying about Zignals on Investimonials.com.

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