Over the course of my vacation, I have seen markets go from a nascent sell off to a recovery bounce. After four days of gains, markets finished the week slow close to, or at resistance. Shorts may find opportunities in Tech indices. The Nasdaq 100 is at resistance with Friday's doji marking a double top with the July bearish engulfing pattern. Adding to this, there is a potential relative performance switch (to weakness) against Small Caps. And there is natural resistance at 6000 to consider too. Technicals are net bullish but stochastics are overbought so some easing even if just turns into a bullish pullback is perhaps favored. Stops go above 6,010.

Friday offered the opportunity for more but in the end it was honors even between bulls and bears. The S&P finished the week on bearish net technicals on higher volume distribution. One positive was a potential doji (and a chance for a 'bullish morning star' on Monday) which is a chance for bulls to buy the open with a stop on a loss of 2,420. Another is the very strong relative performance - when money comes into the market it's the S&P where it's going.

Today's losses look big on current charts but in a historic context, they weren't too severe. However, big red bars are not to be ignored and 'market leading' Small Caps have felt the full brunt of the selling from July which is bad news for the broader market.  Today's losses in the Russell 2000 undercut the 200-day MA leaving 1,345 as next support (of which I would not be too confident of it holding).

We had the profit taking sell-off and then the bounce but is now the time for shorts to come in more aggressively? After yesterday's gapped gains there was a significant slow down in the market advance. This action presents an opportunity for shorts to attack. The Semiconductor Index is one of the most attractive indices for shorts. The massive June bearish engulfing pattern remains dominant and offers guidance going forward. Tuesday's doji has the makings of a bearish harami cross.  Technicals are bearish and aligned in shorts favor.