S&P Breakdown From 'Bear Flag'

There was no acceleration in the losses for the Russel 2000 and Semiconductor Index but today it was the turn of the S&P to break from its 'bear flag'. It was more of a technical break than an absolute loss but given net technical weakness, it must be respected.

The Dow also broke from its 'bear flag'but the 200-day MA is available to lend support (already lost for the S&P). Other technicals are net bearish.

Tech Indices are caught in a mixed zone. Some may argue it has already lost 'bear flag' support; others may view it at continued support.

The Russell 2000 is down trading at the recent swing low. Aggressive buyers could go long a move above 1,551 with a stop on a loss of 1,530.

For tomorrow, today's indecision probably reflects a reluctance for shorts to add to their positions and for bulls to 'sell' - this leaves the next move for buyers to come in and for shorts to cover. The basis for a rally, and maybe a challenge of prior highs, looks to be in place. If you are a short, don't get greedy. If the 'bear flags' are to play to form then decent downside has to come soon, otherwise, it will trade out flat (and into a sideways consolidation).

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