The week finished with some tasty looking breakouts in Large Cap and Tech Indices. Best of the action was given over to Large Caps with volume perhaps the most disappointing aspect of these breakouts. The S&P closed the week out with a respectable breakout on a new ADX 'buy' trigger. This followed a MACD trigger 'buy' earlier in the week. Monday will be about defending 2,450 and staying above that mark at close of business. Long traders should play for a move to upper channel resistance.

Two days of gains have helped re-establish the bullish technical picture for tech indices, Nasdaq and Nasdaq 100. While the improvement was welcomed it didn't come without a price. The Nasdaq broke through declining resistance but also left it itself wedged beneath the former rising channel.  If there is a chance for shorts, then tomorrow could be it.

Since my last update, there was a significant break and piecemeal recovery across many markets. Not all markets suffered to the same degree and new leadership could emerge. The Semiconductor Index made steady gains after suffering the largest profit sweep in June. The bearish engulfing pattern remains the dominant pattern but the index managed to return above the 20-day and 50-day MAs (not to mention, the former rising channel). Relative performance improved against the Nasdaq 100 but it hasn't yet challenged the 'bull trap' created after the bearish engulfing pattern.

On a day where losses were recovered and gains lost it was more of the same for indices. The index I'm watching most for leads is the Russell 2000. The Russell 2000 has languished for many months but is showing signs of strength in what could turn out to be a very good second half of the year for the index.  Today saw losses which dropped the index back to rising support (a fresh buying opportunity?) but relative performance lost a little ground. Further losses would keep the index stuck inside its range and therefore be less attractive for buyers.

Heading into the July 4th holiday and indices experienced a mix of reactions.  Large Caps came out relatively unscathed with only a minor reaction to last week's selling. The S&P remains caught inside its tight trading range since the start of June. There is an On-Balance-Volume 'buy' trigger but other indicators like the MACD and ADX are bearish.

I was 'out-of-office' Thursday when bears came in and ripped up Wednesday's recovery gains. Friday saw some indices give up a little more but the damage was done the day before. The Nasdaq effectively confirmed the channel breakdown and kept the June 'bull trap' in play. The 50-day MA was undercut but there is room to recover on Monday. Technicals finished last week net bearish. Friday's action sets up a move to the slower rising trendline.

The last few months have seen Small Caps trade inside a lengthy sideways pattern but its moment in the shade maybe coming to an end.  Today's rally in the Russell 2000 was a picture perfect bounce off rising support.  Not only that, it mounted a strong challenge on the early June 'bull trap'.  This improved strength has been represented by the continued uptick in relative performance against the Nasdaq. The next watch area will be a new MACD trigger 'buy' to coincide with a negation of the 'bull trap'.  Once it gets out of the range it will open up for a new round of speculative investing.