Breakdown From Pennant in S&P

Yesterday, the Russell 2000 broke past resistance. Today, the S&P dropped out of its consolidation pennant, finishing on trendline support. Volume rose to register distribution with only stochastics holding on to bullish momentum. If there is a positive it's that today finished at converged support; tomorrow may be the bulls last chance to make a run to 2,120 unless a more protracted consolidation emerges.


However, the Dow has also fallen out of its trading range.


The Nasdaq is holding up better than the S&P, and is flying under the radar as it threads the eye of the needle between 5038 support and 5096 resistance.


The Russell 2000 breakout is just hanging on, but today's decline didn't help. However, it didn't reverse enough to undo the relative performance gain.


Bulls will be looking to defend the remnants of the Russell 2000 breakout, and/or taking a punt at converged support of the S&P.

You've now read my opinion, next read Douglas' and Jani's.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com, and Product Development Manager for ActivateClients.com. I do a weekly broadcast on Friday's at 13:30 GMT for Tradercast, covering indices, FX and gold, silver and oil - all are welcome! You can read what others are saying about Zignals on Investimonials.com.

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