The Nasdaq took a further hit, but not enough to increase the relative weakness of the index. Volume climbed to register a distribution day with September lows not looking like it will hold as support.
The real victim was the Russell 2000. It took a loss of over 3%, which pushed the index to a 15.6% loss against the 200-day MA and into the 5% percentile of weak prices. I took a cheeky long on $IWM, but wouldn't be surprised if it was stopped out tomorrow. The index has long said goodbye to August/September lows. If there was (any) positive, it was the small uptick in CCI and Stochastics.
The Nasdaq 100 is also looking to a speedy loss of September lows and probably August's too.
Tomorrow will best be viewed as a damage limitation exercise, assuming bulls are able to mount an attack. If not, then capitulation is next.
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 also trade on eToro and can be copied for free.
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