There was a bullish setup on Wednesday's close for the likes of the Russell 2000 and Semiconductor index, but after a bullish start markets drifted lower by the close. The S&P finished with an inside day which in itself is bullish; stops on a loss of yesterday's low. The Nasdaq started with a gap higher, but it couldn't push the advantage and technicals failed to improve. It was the same story for the semiconductor index, but until it breaks yesterday's low it remains 'long' favoured. It was the same story for the Russell 2000 with yesterday's low the stop for a long position. It's looking like a case of rinse and repeat for Friday.  Today wasn't great, but it didn't change anything either. Semiconductors and Russell 2000 are best placed for potential buyers. --- Follow Me on Twitter Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com . I offer a range of stock trading stra

Selling continued for a sixth day but it didn't violate the support which has been in play for the past couple of days. The semiconductor index opened at its 200-day MA and was able to rally back to yesterday's close.  Technicals are still in the bear camp but buyers may be willing to overlook this in favour of 200-day MA support. The Nasdaq finished lower but in the process clambered back to declining support as it attempts to create a swing low.  The index finished with an inside day which keeps Tuesday's low in play for stop placement. The Russell 2000 was able to retain wedge support despite finishing slightly lower.  Technicals returned to a net bearish state but in doing so also moved into oversold territory.  But working in bulls favour is the continued shift to Small Caps over Tech stocks.  The S&P was caught in the middle, working in the absence of clear support with a 'Death Cross' between 20-day and 50-day MAs to stoke bulls' fear

It took a while for markets to stage a recovery today but its questionable if it will be enough to offer buyers the confidence to come in. Europe looks to be back to square one and this time the outcome could be worse; how much of this uncertainty has been priced in remains to be seen, but markets are probably still too rich for most people (had this news hit after a more protracted decline it might have offered the washout to complete the bottom). The Nasdaq is clinging on to backtest support, but for a while it hadn't offered any help.  Volume soared to register a significant distribution. Today's low is the marker for stop placement. The Russell 2000 was able to defend wedge support, but the wedge will soon resolve as it narrows into an apex; it plays as a long on today's close (stop on break of today's low). The Dow lost trendline support, but with additional support at 12,700 there is a strong chance it will become range bound in the 12,700 - 13,250 ran

Friday was when the damage was done to the Daily timeframe charts, Monday was just a respite to the selling.  All indices were hit.  The S&P was left with a 'bull trap' after Friday's selling undercut the 50-day MA.  All technicals are net bearish, but a loss of 1,357 would put a new swing low into play. The 200-day MA would then become the next target down. The Nasdaq has already marked a new swing low, but there is an outside shot of a support backtest.  Technicals had turned net bearish before the S&P, but there is a nascent bullish divergence shaping up in the MACD histogram, with on-balance-volume about to turn net bullish. The Russell 2000 has been range bound for most of 2012, so Friday's selling didn't impact as much as it effected the S&P or Nasdaq. While the semiconductor index is treading water at 395 support there are early signs of bullish divergences in supporting technicals. The presence of support in the Semiconducto

While events in Europe will cloud trading action this week, NetEase is nicely positioned to break resistance.  There are a couple of support levels to use for stop placement; these include $59, 20-day MA, rising support for April swing lows, then 50-day MA.  Earnings are May 16th which will an offer an event trigger assuming it doesn't break before.  My fundamental take is available on the Motley Fool .

My latest Motley Fool article on MercadoLibre is available here . Currently range-bound between $90 - $100 with earnings due Tuesday; how will this break the range?

It was a tough week for markets with more speculative Small Cap and Tech Indices taking the brunt of the selling.  Market breadth was similarly weak, although swing lows created for these indices weren't challenged. Small Caps lost a hefty 4%, bringing the index back to neckline support. This is a buying opportunity although the nature of last week's selling suggests it's not quite done (perhaps a weak follow through on Monday/Tuesday). Technicals remain bullish and there are a number of support levels to play with in addition to neckline support; chiefly rising support and 760. The Nasdaq suffered a 'sell' in the MACD histogram.  Like the Russell 2000, selling was hard; but unlike the Russell 2000 it hasn't yet reached its first point of support.  It's going to take a break of 2,885 to suggest something more bearish is going on. But the Percentage of Nasdaq Stocks above the 50-day MA is more bullish than it was four weeks ago. The S&P w