Daily Market Commentary: Prior 'Bull Traps' Hold
The failure of politicians to agree a Federal Debt Plan prevented certain markets (chiefly Nasdaq and Russell 2000) from pushing into the fresh air of no overhead resistance. Despite this, Monday's selling was not hugely problematic, nor heavy. The S&P eased back from quite stubborn resistance at 1,343; technicals held net positive. For tomorrow, look for test of fast approaching 20-day MA. Which will break first? 20-day MA support or 1,343 resistance. The Nasdaq was pegged back to 2,836 support but remains stuck in the 'bull trap' zone. The 20-day MA lurks at 2,800 to offer a second tier of support. But with the Nasdaq 100 holding its breakout despite today's losses it will be important for the Nasdaq to pressure 2,884 resistance. And the challenge for the Nasdaq 100 is clear - maintain the breakout. While the Russell 2000 is losing some steam as it struggles to clear the broad trading range. Holding the 20-day MA is an important starting point and that