The second half of last week saw challenges of recent highs rejected (for the Russell 2000 in particular), but today it was the turn for bulls to repel the action of sellers.
The S&P returned to its open price, although trading volume was light. Today’s low is a place for stops, although buyers will want to see morning action hold above 1,877 to build confidence.
The Russell 2000 sold off more aggressively than other indices. The index is not out of the woods and sellers could return tomorrow for a push down to the March 4th breakout gap. Bulls will want a respectable gap higher to break this push lower. There was a ‘sell’ trigger in the CCI to give bears another foothold to work with.
The Nasdaq experienced a ‘sell’ trigger in On-Balance-Volume, but the degree of loss was small and trading volume was light. The 20-day MA might offer a launching point for long positions tomorrow.
The Nasdaq Summation Index added another 9.6 points to leave it at 476.80, which has been resistance for the latter part of 2013 and the first part of 2014. However, it’s well away from 700+ highs of early 2013. Â A push above 500 brings the 700 highs into range.
For tomorrow. look for bullish opportunities, but it might mean riding out another run by shorts in the morning, although it will be important selling doesn’t take out Monday’s lows as it will likely dampen enthusiasm for a recovery in the afternoon. Â Aggressive longs could look to buy as prices approach the lows.
