The S&P finished with a neutral doji. The index hasn't yet challenged declining resistance connecting November/December highs and until this happens, shorts will have an angle to work.
The Russell 2000 is nursing its breakout, and two days of losses haven't done enough to break the back of bulls. ROC is holding to the bear side of the argument and if bulls are to win the long term argument they will need to break the zero line of ROC. Meanwhile, relative performance is shifting back in favour of bears.
Ideally, tomorrow will see something more positive from speculative Small Caps. Otherwise, bullish action in Tech indices may not be enough to protect against further losses in Large and Small Cap indices.
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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