The S&P is at resistance of the prior swing low and the 20-day MA, but today's action is looking good for an upside break tomorrow? Technicals are firmly in the red and need more than today's gain to fix them.
The Nasdaq did today what the S&P could do tomorrow. Supply issues are likely to kick in at 5,900, but a bullish On-Balance-Volume and a bearish MACD means one of these signals has to give?
The Russell 2000 also staged a good recovery to generate a 'bear trap' of its own. There is converged resistance of 20-day and 50-day MAs to consider, but if it can get above this then it has a free shot to challenge 1,414.
For tomorrow, watch for weakness in the first half hour of trading, this could be the pullback buying opportunity of this swing low. However, if markets remain weak through the day then it may suggest a 'dead cat' bounce.
You've now read my opinion, next read Douglas' blog.
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