Markets lost ground for a sixth consecutive session as the S&P 500 recorded its first such streak of the year, but the Nasdaq did record a 8 session losing streak dating back to 12/3/15-1/11/16 which fell top to bottom by 600 handles. The S&P 500 and Nasdaq did finish off session lows but the technical damage is growing by the day, and the benchmarks accustomed to big, brief slides feel different this time around with small nicks as the bleeding begins to accelerate. The S&P 500 did find a small bounce at the round 2100 number after coming in within 6 handles of the 2200 figure back on 8/5 and has the look of a rounded top pattern. Of course things can change quickly, but active traders have to trade with the belief that the path to least resistance is lower. The Nasdaq did come close to touching the round 5100 number before a slight bump pushed it higher, recouping about half of intraday lows. Its chart now has the look of a potential bearish head and shoulders pattern setting up with the left shoulders transpiring between early August and mid September, the head completed today, and perhaps a dead cat bounce is in store to complete the right clavicle. Small caps once again were the clear laggards with the Russell 2000 losing more than 1%. Looking within sectors Tuesday was the direct opposite of Monday with the utilities the worst performing group with the XLU down 1.8 (XLRE was lower by 1.9%) and the XLE going out close to the UNCH line being the best actor. Gold is acting better and looking for a potential third weekly advance in a row as it readies itself for a test of a declining 50 day SMA. The GLD gave some important clues recently when it recorded 5 doji candles in a period of 7 sessions between 10/6-14 and posted a bullish harami cross on 10/12 as well. Healthcare, via the XLV, recorded a bullish hammer candle today and some names in the group behaved benignly Tuesday. BMRN fits the bill although we were WRONG about this name recently with its bullish hammer on 10/17, but today recorded a nice bullish engulfing candle at the round 80 number which has held for the third consecutive session and filled in the gap from the 7/6 session.
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