The Russell 2000 led the market out with a 1%+ gain as relative performance continued to gain ground; the next phase of the Small gap rally is well underway. This is good news for bulls looking for gains to continue throughout the summer.

An interesting start to the week. Markets gapped higher off the open and were able to add some distance to their starting points. The Russell 2000 chalked up a near 2% gain as it makes a run on 1,347.  This was enough to finish the day at the high.  The MACD is still on a 'sell' trigger, but another day like today should be enough to reverse it.

Indices experienced varying degrees of buying Monday, most of it relatively small. Biggest winner was the Semiconductor Index as it rallied from converged channel, 20-day, and 50-day MA support. This was accompanied by bullish upticks for both ADX and Stochastics.

Today was a good day for market bottom watchers as new support levels kicked in for indices. Best of the bunch looks to be the Russell 2000.  It still has a relative performance advantage and the bottom it's shaping came off a 'real body' bounce alongside a fresh MACD trigger 'buy'. It's early days, and the 'buy' signal I had marked as a retest was perhaps a little early but should still be good enough that such buyers will still be holding at this stage; stops on a loss of 1,465.

Markets plumped for a non-Brexit. While markets closed higher there wasn't the volume to suggest a great degree of confidence in the finish.  As of writing, it would appear the market 'got it right' and an opening gap higher will emerge. What bears will be looking for is a bearish 'black' candlestick, which is a close below open despite a higher close than previous session (day). The S&P is on course to tag upper broadening wedge resistance. Watch for a MACD trigger 'buy' as bulls look to press their advantage.

In early morning action it was a clear swing to sellers after yesterday's non-event. However, buyers came back and were able to make a good chunk of these losses into today's close. Large Caps remained the most attractive as defensive stocks often are during times of doubt. The S&P registered higher volume accumulation as intraday action proved to be relatively tight. The Nasdaq suffered larger losses, but there was no distribution to go with it. Technicals were relatively immune to today's action.

It was another day of modest change with little real turn in bullish/bearish outlook.  The Russell 2000 was the only one index to mark a technical change with a net bearish switch in technicals (MACD, Slow Stochastics, On-Balance-Volume).

Not a whole lot to say about today. The Semiconductor Index gained nearly 1% as it pushed a new multi-year high, but most of the gains were achieved by the open and it didn't add too much after that. However, it did keep shorts at bay for another day (resistance remains former channel support).

Yesterday's buying likely caught shorts out, but later weakness may have encouraged profit taking today. The damage was relatively light and only served as a warning. For example, the S&P didn't lose breakout support and selling volume was light

While most indices were able to post small gains it was left to the Semiconductor Index to post a small loss; leaving a bearish engulfing pattern at its 50-day MA and an ideal opportunity for shorts to take advantage of the new (intermediate) downward trend. In such a scenario look for stops above the 50-day MA. The flip side, if there is an early push above the 50-day MA then these same short-stops are likely to trigger an acceleration in the rally and bring fresh buyers in a new long trade; a long trade working off oversold conditions.

Still a week to go before regular service resumes.  However, a quick look of the markets since my last post points to the rude health of more speculative issues while more conservative 'blue chip' stocks glide sideways. Semiconductors have had an excellent summer.  This is a key economic bellwether and points to improved business conditions, helped by cheap copper prices. The burst higher over the early part of last week is consolidating its gains near the large white bar highs. This should also offer a boost to Nasdaq and Nasdaq 100 stocks.

Two days of indecision has given way to another day of gains for bulls. Volume was lighter, but there was an important technical gain with reversals of MACD 'sell' triggers. The S&P is on its way to challenge 2,125 with the rally re-established.

After my 2 week work break I've come back to a mixed message market. The question is which market is in charge? The clear leader over this period has been the Semiconductor Index. It pushed to new highs in a strong relative push. This restores the net bullish technical picture for this index dating back to July. The question is how much strength in this index can pass through to the Nasdaq and Nasdaq 100. The fresh MACD trigger 'buy' is a new pullback signal with a stop below the recent swing low.

Well, that didn't last long, Trump's comments on Chinese tariffs stuck a knife in the rally but the damage wasn't total. Anyone who shorted or sold the resistance test in the S&P will be happy, but breakout buyers in the Nasdaq will have been stopped out as a 'bull trap' is confirmed. The S&P gave up both the 50-day and 200-day MAs as the rate-of-change remained in sub-zero territory throughout the rally. Both the MACD and On-Balance-Volume are holding on to their bullish signals but there needs to be a sharp recovery (starting Thursday) if these signals are to hold. Investors were offered another 'buying' opportunity as part of the buying the dips after the Oct/Nov 'buy' signals.

Large Caps continued to press Thursday's advantage with gains to send indices towards recent swing highs. The S&P remains on course to reach channel resistance and post new highs with technicals net bullish and relative performance in the ascendancy against Small Caps.

The coiling setup from last week unwound itself with a move lower; whether markets have blinked and are ready for further losses or if this is just some 'bear trap' remains to be seen. The key test will be whether support from long established rising price channels will hold if such losses continue. The S&P only posted a small loss and some may consider Friday's action a shift in the coil position (use the 2-day high/low to define the trade and stop). However, the rising channel is very close and is in close proximity to the 20-day and 50-day MA.

There was a shot across the bows from Large Cap indices as the consolidations which were playing out the last few weeks took a step south.  For the S&P this amounted to a clear breakdown and the risk is further losses to take things back inside the 2,575-2,675 range; however, if this does occur I would look for further losses as the momentum which drove the initial advance fades. Not surprisingly, today's breakdown also came with technical 'sell' triggers for MACD, On-Balance-Volume and +DI/-DI

After yesterday's blast, bears took another chunk out of the recovery. Bulls might actually get more joy with a small position at the lows of the last three days in Large Caps. Pre-market action will be key; should it look like the market will open below the 3-day low then there could be a runaway lower. In such case, waiting for things to settle after the first 30 minutes of opening trading may offer a better entry.

Semiconductors were the star of the week.  The index cleared Match/April congestion and posted six consecutive winning days in a row. Technicals are all in the green and the index is above all key moving averages. Weakness will be a buying opportunity; a test of the 50-day MA would be a good start.

It was a strong finish for markets as they clawed back some of the early week losses. Some indices do look better than others and could offer bulls the opportunity they need into next week. Best of these could be the Russell 2000. The index left a picture perfect 'tweezer bottom' which has the potential to morph into a swing low.  If true then the index should push beyond 1,564 with little difficulty before challenging 1,615; risk is measured against a loss of 1,495.