There was no doubt as to the nature of Friday's action. A weak, end-of-week close adds to the negative tone, suggesting the damage is more long term. However, not all indices are in true bearish mode. The S&P is stuck inside its range, and won't be challenging range lows until 2,045 comes into play. The 200-day MA at 2,063 is an area to look for buyers, although the last test of this key moving average was in early July, which is a little too soon for a new test to hold again. Technicals are mixed, which fits with what is trading range action. Bears may win in the long term, but bulls may get some joy at the 200-day MA for a short term bounce play.

Bears keep the pressure the on with another around of selling. Markets remain range bound, particularly after July's sell off and recovery, which confirmed market trading ranges. The S&P finished at its 50-day MA on lighter volume selling. Beyond the 50-day MA next comes the 20-day MA, but neither MA has played as support in recent months.

There was some spill over from yesterday's after hours disappointment in Apple, but after a weak open, bulls were able to mount some challenge by close of business. However, today's close was still below that of yesterday and registered as distribution. Hardest hit was the Semiconductor Index. It experienced a gap down, shedding 2.5%, as it continues to trend lower. Given the extent of the decline it's hard to see how the Nasdaq and Nasdaq 100 can continue to trade near yearly highs.

A bad day for earnings, with IBM, United Technologies and Apple all disappointing. With indices at highs (or just shy of resistance) it was going to be a day of easy selling.  With technology particularly hard hit, the Nasdaq did well to cling on to its upside breakout, but given Apple's earnings were after hours it's unlikely to be the same story tomorrow.