Daily Market Commentary: Volatile Spread
The S&P turned net bearish as the index undercut but recovered the 200-day MA by the close of business. The index also said goodbye to declining former resistance as support. The index is looking more range bound with support at 1,260 and resistance at 1,343.
($SPX)
via StockCharts.com
A little more promising is the Dow. It closed Monday with an indecisive doji (not normally a positive), but it was able to finish on channel suport. Technicals are net negative, but it does have the 200-day MA to look too.
($INDU)
via StockCharts.com
The Nasdaq didn't suffer to the same degree as the S&P. Technicals are clinging on and it still has declining resistance to lean on (not to mention the 200-day MA).
($COMPQ)
via StockCharts.com
Semiconductors took another step down. Enough to negate the bear trap into a lowering of support. Nothing to suggest this decline is done - and this is bad news for the Nasdaq and Nasdaq 100.
($SOX)
via StockCharts.com
The Russell 2000 lost its 200-day MA. It only has 773 trading range support left before a more protracted decline takes hold. With Small Caps leading down it sets a poor tone for Large Cap and Tech indices.
($RUT)
via StockCharts.com
Today's broad intraday spread will probably be followed by one or two inside days. This coiling action will prime the next big swing. Even if this is down it may not necessarily be bad - a powerful bear trap could emerge (although I say this holding a long position!).
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