Apple's earnings disappointment had set the market up for turmoil, but again, markets were able to hold up against expected weakness. After December's fall into 'Strong Buy' territory, we now have a market immune to bad news which for investors means they can keep on buying. I had looked to the Russell 2000 to be the next market leader and today's losses weren't enough to reverse a prior relative performance gain against the Nasdaq and S&P. Days like today are typically followed by a loss, which here is ultimately a retest of 1,266. Should this happen, traders can protect themselves with GTC buy orders set around 1,270.

I was going to say how well markets did to finish near highs after pre-market action has indicated a possible rout but now we have Apple after-hours earnings report contributing to a 7%+ loss ... An open at 146s would start the stock at the December swing low but the trend is clearly down and technicals - aside from the MACD trigger 'buy' - are not offering any bullish divergence.

Since my last update markets have taken a bit of a spin. Investors should now take note that both the S&P and Russell 2000 fell into the 'Strong Buy' territory in the move to their respective swing lows.  The Russell 2000 fell as far as 20% below its 200-day MA; note, if it reached 21.4% below its 200-day MA it would be in the 1% zone of historic weak action going all the way back to 1987; like it or not, this is a significant  investor buying opportunity for Small Caps stocks.

Now the panic will start, but Investors should be rubbing their hands in glee. The Russell 2000 has dropped into the 5% zone of historic weakness with the Nasdaq in the 10% zone (S&P unchanged in the 10% zone). Shorts will be happy too but will need to be mindful of snap bear rallies which can quickly clock up 20% gains - and eat up profits (without breaking the broader bearish trend).