Yesterday's gains reversed
Since the last update there has been a bit of back-and-forth for the indices. The Nasdaq had bounced off breakout support yesterday before it quickly gave up those gains. It was a similar story for the S&P, although this index trades well above its key moving averages. The Russell 2000 experienced the lightest loss, although its struggling to clear its handle.
If the Russell 2000 is to lead out it needs to build on yesterday's gain and not suffer too many days like today. Small Cap leadership is vital to the sustainability of any rally, and we are not there yet.
Indices are effectively consolidating gains after a sequence of consecutive up days. As long as things stay sideways (before resuming the rally), then current action is not a concern. However, all it will take is a big red downward candlestick to spoil the party.
You've now read my opinion, next read Douglas' blog.
Accepting KIVA gift certificates to help support the work on this blog. All certificates gifted are converted into loans for those who need the help more.
Investments are held in a pension fund on a buy-and-hold strategy..