Friday saw some big volume trading as options expiration kicked in.  However, there was little change in price action across indices. The Nasdaq and Nasdaq 100 are both in play for Monday, each offering a chance for longs to enter at a combination of channel support and 50-day MA. Technicals are weak, and a move for stochastics [39,1] below 50 would shift technicals net bearish.

It was a mixed day for markets. The day started with a gap down but bulls were able to make a respectable recovery to finish well yet still net down on the day. The index best placed for a bounce on Friday is the Nasdaq 100.  In addition to finishing on rising channel support the index has the 50-day MA to lean on too. Today's open started at the 50-day MA.  Technicals do not offer much encouragement with a new 'sell' trigger in On-Balance-Volume to follow the existing 'sell' in the MACD.

Markets experienced another round of profit taking but there was only one market showing a potential top. Yesterday, the Russell 2000 edged a breakout but today sellers put this in jeopardy with a potential 'bull trap'. The 'bull trap' in the Russell 2000 will be negated on a move above 1,433. Further losses will drop the index back inside the prior consolidation, but 'bull traps' often lead to moves to the other side of the consolidation - in this case, a break below 1,340.

After Friday's selloff, it was left to bulls to try and paint over the cracks. The Russell 2000 returned to its breakout with a small gain over 1,420. The spike high is still influential, but the move into the spike high weakens the significance of this typically bearish candlestick. Also, note the sharp rise in relative market performance against the Nasdaq.

The 'most hated' rally, started in 2009, suffered a potential setback with wide range (neutral) candlesticks across markets. How much the UK election result played on this remains to be seen but Friday's trading marked a day of chaos.  Shorts should not be jumping so much for joy. The rally for the past few months has taken indices to a point where a 25% loss - a definition for a bear market - would only see tests of February's lows in 2016 (and nowhere near a test of 2009 lows or anything later). The S&P experienced higher volume distribution as the day closed with a 'spinning top'. Next week will be about consolidating the action in the context of Friday's close and holding the breakout. Technicals remain positive

There wasn't much to attract interest but the Russell 2000 managed to stick its head above the parapet with a solid gain.  The Russell 2000 was left just shy of challenging trading range resistance.  Other indices are trading in a tight range which builds tension for a reactionary move; given what's happened in Small Caps, a breakout higher is perhaps favored. The Russell 2000 cleared inner resistance of the 'bear trap' and brought the index to trading range resistance. Tomorrow, watch for a consolidation at 1,420 before the Russell 2000 pushes higher.

Today was the perfect day for bulls looking for buying opportunities. Markets exhibited small bullish 'hammers' as part of a 3-day pullback; collectively shaping up as bullish flags. As an added bonus, volume rose to register an accumulation day. The S&P pullback will be confirmed on a move above 2,435 with a stop on a loss of 2,425.