Well, that didn't last long, Trump's comments on Chinese tariffs stuck a knife in the rally but the damage wasn't total. Anyone who shorted or sold the resistance test in the S&P will be happy, but breakout buyers in the Nasdaq will have been stopped out as a 'bull trap' is confirmed. The S&P gave up both the 50-day and 200-day MAs as the rate-of-change remained in sub-zero territory throughout the rally. Both the MACD and On-Balance-Volume are holding on to their bullish signals but there needs to be a sharp recovery (starting Thursday) if these signals are to hold. Investors were offered another 'buying' opportunity as part of the buying the dips after the Oct/Nov 'buy' signals.

Trump's overnight deal with China was going to cause a gap higher in the market. The challenge was whether this gap would be faded by shorts or if bulls would be able to push it higher. The end result was mixed as bulls were unable to add to markets off the open but the likely short fade never materialized - which is good. The S&P tagged resistance from the October and November swing highs as it finished the day with a neutral doji.  Short term (buyers) will take profits here and aggressive shorts may try to attack the bounce but long-term investors can hold for another move lower before adding.

A good finish to the week left no doubts as to which side had control of the market this week. Bulls stepped up Wednesday and added a finishing touch Friday. Volume climbed in confirmed accumulation. Where possible, I have drawn new resistance lines connecting October and November swing highs which are the new upside targets for current market rallies. The S&P hasn't turned fully net bullish (in technical strength) but it's only a couple of days away from doing so. The index finished Friday on its 200-day MA which may offer some resistance on Monday.  Get past that, then there is the 50-day MA before the index gets to challenge the resistance line from recent swing highs.

The Fed stepped in at a good time with positive comments on rate increases as markets put some distance on recent swing lows. All markets now have a bit of wiggle room to defend and with seasonal 'Santa Rally' ready to kick off then we yet have more good news to come. The biggest one-day gain was the Nasdaq 100, it gained over 3% on higher volume accumulation. These gains came with a bullish cross in relative performance against the Russell 2000 and 'buy' signals for the MACD and On-Balance-Volume.  The first test will be the convergence of 50-day and 200-day MAs around 7,100.

Today was a good day for market bottom watchers as new support levels kicked in for indices. Best of the bunch looks to be the Russell 2000.  It still has a relative performance advantage and the bottom it's shaping came off a 'real body' bounce alongside a fresh MACD trigger 'buy'. It's early days, and the 'buy' signal I had marked as a retest was perhaps a little early but should still be good enough that such buyers will still be holding at this stage; stops on a loss of 1,465.

It could have been better but bulls should be happy with the work done in the Russell 2000. Yesterday's close pushed the index into the 10% zone of historic weak action (reached in October 2018) while also confirming a double bottom on a two-bar reversal. It's a second 'buy' signal after last Thursday's failed.

A mixed bag of action. Long-term investors can look to the losses in the Russell 2000 and Nasdaq as another accumulation opportunity but if you bought Thursday's bullish piercing pattern of the Nasdaq as a near-term trading opportunity you will likely have been stopped out - or feeling ready to flee. As a trading opportunity, the Russell 2000 is just above its stop zone (loss of Thursday's piercing pattern low). The MAD is still holding its 'buy' trigger along with its relative performance advantage, but ROC is accelerating lower - moving deeper into bear market territory. Investors shouldn't fear the noise and keep on dabbling a little here and there on the buy side.