Stock Market Commentary: Late day collapse

Far greater damage done after a wide range day started with new highs - but closed at the day's lows. Volume climbed to register a distribution day which sets up the possibility for a double top. Watch September reaction lows for support as this will form the neckline for any double top.

But for all the indices the first test will come from 20-day MAs, with 50-day MAs very close by.

The Nasdaq 100 closed with a bearish gravestone doji on technical distribution. This is the first time in a while where there has been three consecutive distribution days for the index

The Dow gave up the 10,000 media love-in but has plenty of room to its 20-day MA. But the cracks are getting bigger.

The Russell 2000 took a big step down with its MACD trigger 'sell'. Like the semiconductor index, it's in the process of a 20-day MA test.

From these charts it would appear small caps and semiconductors are going to lead the market into a long awaited down phase.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

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