Friday saw strong defense by the bulls, but the frequency of the support test is a concern. The Russell 2000 is looking to be the most vulnerable as it attempted a (failed) bullish piercing pattern. Friday's buying barely cut into Thursday's selling, but the index is outperforming the Nasdaq. Yet it will need to push from here if it's not to collapse. Either way, I'm not liking Friday's action.
The Nasdaq made a second attempt at 200-day MA support, but buying volume was above previous selling (and buying). Technicals are net negative and the index lost more ground against the S&P 500. Yes, Friday was a successful test of the moving average, but for this to happen twice in the one week is a but much.
The S&P was not left out of the party as it successfully tested channel support. Unlike the aforementioned indices, it registered as a day of accumulation. There is also the relative performance of the index to the Russell 2000 and momentum (stochastics) holding the mid-line, although other indicators are negative.
On the surface, Friday looked good, but the likelihood of a sustainable bounce is looking more unlikely.
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