Russell 2000: Sellers Appear as Support Comes Under Pressure

It was going to happen at some point, but sellers have come out of the woodwork. Tech was hardest hit, but there is plenty of support for indices to work with.

The () was one of the least impacted by the selling. It staged a mini-breakout, while Wednesday’s inverse hammer came on higher volume accumulation, it’s still in a position where it could go either way.

The is defending the 20-day MA while the MACD holds to a ’sell’ trigger. The relative outperformance of the index to the weighted S&P is a positive but the ’tweezer top’ remains the dominant influence.

The weighted ($SPX) is trading at its 50-day MA. The double doji on the gap down has the potential to be a bullish island reversal *if* it can gap higher. Technicals are mostly bearish, while momentum sits at the mid-point that typically marks a tradeworthy bottom. If this should undercut the midpoint in stochastics and price breaks the 50-day MA, then the next target is 7,000.

The sits in a similar predicament as the S&P, but it undercut its 50-day MA as selling volume picks up. Technicals are net negative, including an undercut of the stochastic midline I’m looking for the S&P to defend.

continues to favor the short side and a loss of 60K could see another big step lower. Technicals are bearish with the exception of weak MACD ’buy’.

The are holding out on net bullish technicals, but a sequence of bearish spike highs leaves it vulnerable to selling. Should sellers attack, look for a test of the 20-day MA.

Finally, have left a doji ’bull trap’ with ’sell’ triggers in the MACD, CCI and ADX, but momentum remains strongly bullish. The index is holding its 20-day MA, but a test of the 50-day MA would be welcome at this point.

For today, interest will be on how indices defend 20-day MAs. Profit taking is likely across the different indices, but if they can stabilize just off highs it will go a long way to calm the nerves of traders concerned with the rapid pace of gains.