Stock Market Commentary: Break and Run
Courtesy of Fallond Stock Picks
Whatever strength the indices managed the past few days was quickly whipped away. Semiconductors drove the push lower with a 4.6% loss bringing the index very close to its 200-day MA; a test of this moving average is looking likely.
The S&P went from a potential bull trap to a confirmed breakdown. Death cross between 20-day and 50-day MA imminent.
The nascent CCI ‘buy’ signal in the Russell 2000 was also blown away. There was a relative strength swing away from Small Caps towards Tech, with Large Caps leading the markets – the most bearish alignment for markets.
Tomorrow will probably lead off with a rally, but if this is the start of a more protracted decline then a respectable rally is required to define the upper boundaries of a new downward channel.
