Today saw Tech indices start to challenge the swing lows of the November and early December lows. How these indices react will determine how other lead indices will follow. First up is the Nasdaq; today's high tagged this resistance (former support) level. Aggressive shorts will have attacked this area but will be forced to cover if there is a close above 6,855; technicals are mixed, but relative performance (vs the Russell 2000) suggests shorts may still be on the wrong end of the trade.

Friday was the finish markets needed to offset the losses from Apple's earlier in the week earnings release. Once again, markets proved resilient in the face of bad news and this can is bullish.  Those who have been buying the oversold (investor) signals can continue to do so. With the move towards the 200-day MA the strength of the investor 'buy' signals weaken; so those buying on the 12-month window can slow to once a month until the next leg down begins. For the S&P, Friday's gain built support for the MACD trigger 'buy' although it lost relative strength against the Russell 2000. Other technicals remain negative as Monday will see its first test of the 20-day MA (soon to be followed by a test of its 200-day MA) and support lows from the October-December period.

Apple's earnings disappointment had set the market up for turmoil, but again, markets were able to hold up against expected weakness. After December's fall into 'Strong Buy' territory, we now have a market immune to bad news which for investors means they can keep on buying. I had looked to the Russell 2000 to be the next market leader and today's losses weren't enough to reverse a prior relative performance gain against the Nasdaq and S&P. Days like today are typically followed by a loss, which here is ultimately a retest of 1,266. Should this happen, traders can protect themselves with GTC buy orders set around 1,270.

I was going to say how well markets did to finish near highs after pre-market action has indicated a possible rout but now we have Apple after-hours earnings report contributing to a 7%+ loss ... An open at 146s would start the stock at the December swing low but the trend is clearly down and technicals - aside from the MACD trigger 'buy' - are not offering any bullish divergence.