Tests of 20-day MAs for Russell 2000 ($IWM) and S&P ($SPX)

The Russell 2000 ($IWM) and S&P ($SPX) both finished near their respective 20-day MAs registered as test "fails", but not enough to suggest a recovery isn't possible tomorrow. The Russell 2000 does have the August swing high to lean on should it need it. Also, the closure of the December gap can be one to spark a recovery.

The S&P lost ground against its 20-day MA similar to the Russell 2000 but the spike high into the 20-day MA suggests that there is more supply there than today's action was able to consume. Let's see what tomorrow brings, but expectation is for more selling.

The Nasdaq was not so lucky having previously lost support of its 20-day MA a day earlier. There is trading range support from November to lean on which could be worth looking at as a buying opportunity.

While indices have failed suppport at their 20-day MAs and finished where they opened, there wasn't any significant loss beyond opening levels. I would be watching for gaps higher tomorrow.

As an aside, it has been a bad last few days of my Topstep trading experiment. I have been trying to catch a knife on finding the lows for a bounce (not good...) and have been whipsawed by the tight stops leading into my daily loss limit. Trying to trade futures in the Nasdaq and Russell 2000 was too much.

Get a 50% discount on my Roth IRA with a 14-day free trial. Use coupon code fallondpicks at Get My Trades to get the discount.

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Investments are held in a pension fund on a buy-and-hold strategy.

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