Markets staged impressive reversals Thursday, with the Nasdaq putting in the best session as it came on intraday lows of 1.1% just before lunchtime to finish the day with a .2% gain. At todays lowest levels the index was 5% off its recent 52 weeks highs. As Thursdays action was benign, the benchmark is still lower by 1.8% going into Friday. It is still too premature to forecast anything, remember price is always your main focus, but if Nasdaq weakness persists it could potentially form a bearish head and shoulders pattern. The left shoulder occurred the entire month of July, the head assembled in September with resistance at the round 4600 figure. The right shoulder could develop at the 4500 number where 50 day SMA resistance awaits. That would give the Nasdaq another 1% plus lift from here. Energy was the sector rattled the most today although like the rest of the market many names in the group finished well off session lows. The semiconductors which have been among the hottest sectors in the tech space for months now and the SMH which lost its 50 day SMA Wednesday among the carnage, today put in a nice hammer in huge trade. Interesting that the largest component by far in the ETF INTC did not finish as strong. The SMH like many other tradable instruments is going to have to contend with resistance at their respective 50 day SMAs. I am sitting back ready to enjoy the tug of war.

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