A second day of selling brought the indices back towards support. The index looking most vulnerable with the potential to 'bull trap' is the Nasdaq. I'm not sure enough damage has been done to confirm this but another day's selling would probably be enough.

There wasn't a whole lot going on today which was different to Friday. Breakouts in the Nasdaq, Nasdaq 100 and Semiconductor Index remain in effect while the Dow Jones Industrial average took an early hit in profit taking but on lighter volume. Relative performance remains particularly ugly.

Leading indices again continued in their leadership roles; the Russell 2000 managed a new swing high with breakouts for the Nasdaq and Nasdaq 100 after Semiconductors closed at new all-time highs. The Russell 2000 cleared 1,564 with relative ease with upticks in lead technicals - only relative performance suffered a small loss. Friday's 1.6% gain now opens up for a challenge on all-time highs of 1,615. Even if markets were to sell off it would take a few days to reverse the bullishness generated by the rally from the 'tweezer' bottom.

The Russell 2000 may not be the index pushing all-time highs but the last four days have seen steady gains for the index - enough to generate a new relative performance advantage against strong performing Nasdaq and Nasdaq 100. Leadership from Small Caps is critical for building long-term rallies and this is a good start and an excellent confirmation of the `tweezer`bottom.