As this rally has often done, just as you expect a reversal to start, bulls come in (hard) to bid up the market. The S&P had the clearest switch as it moved from a 'bull trap' to a 'bear trap'. If it can post a break of 2,597 it will have little to stop it; in such a scenario watch for a fresh MACD 'buy' which would confirm recent losses as a pullback 'buy' opportunity. Stops on a loss of 2,557.

The Russell 2000 was again under pressure as it shed another 0.5%. The Russell 2000 now trades below its 50-day MA despite recovering some of today's intraday losses. It looks like controlled selling with an artificial prop to prevent a rout. The 200-day MA is the next port of call but a 1% loss of more will bring sellers in fast. Technicals are weak but not oversold.

Another day where bulls had to dig deep to make back early losses but there was little more beyond that. The Russell 2000 remains the index most feeling the pressure. It's trading below the 50-day MA but hasn't experienced the kind of day where longs will feel pressured to sell. Some traders may take an aggressive long with stops below 1,463 with the index hugging support of the (failing) 'bull flag' - although it doesn't look a particularly attractive trade. Technicals are all net negative and relative performance is very poor (for Small Caps).

The index-to-watch for Monday was the Russell 2000 and while it didn't really excite it did suffer a net bearish turn in technicals. On the positive front, it held on to its 50-day MA for a third day in a row. There may still be enough for bulls to reverse the bearish technicals but there is little room for maneuver.

It wasn't a particularly exciting Friday but there were some points-of-action of interest. I had tweeted about the weakness in the Russell 2000 but there wasn't much satisfaction for either side. The Russell 2000 finished with a narrow doji at the 50-day MA. As it failed to close below the 50-day MA bulls will be satisfied with a successful defense of the 50-day MA but the narrow intraday range offers a bigger swing trade off a break of the high/lows from Friday. There is still a chance a break below the 50-day MA will kickstart an acceleration towards the 200-day MA and this still looks like the preferred outcome. Any move back inside the 'bull flag' will open up for a 'bear trap' and a likely break of 1,500 - a move above 1,480 will open up a long trade opportunity.

There were gains for all market but the Russell 2000 was able to dig in and come back after an early loss of 'bull flag' support. The Russell 2000 was able to rally back after testing its 50-day MA; those traders waiting for this will have benefitted from a handy risk:reward.

Some light selling across Large Caps and Tech indices meant there was little of interest for today/s action. The only action of note came in the Russell 2000. After inching towards 'bull flag' resistance the Russell 2000 took a leaf out of the sellers book and reversed back towards 'bull flag' support. It's looking vulnerable to a further profit taking which would threaten 'bull flag' support, although the fast approaching 50-day MA could step in to help.  Technicals are weak and weakening as relative performance swings away from Tech (strongly away) and Large Caps.  A failure at the 50-day MA would next open the 200-day MA; at the latter point I would expect Stochastics [39,1] to be oversold.