We had a big selloff today but it came on decreasing volume. The indices were short-term overbought so this could be looked at as a well-needed drop just to cool things off a bit.

Although the Nasdaq cleared its trendline yesterday it also made a shooting star-like candlestick. That turned out to be a good warning of sellers reasserting themselves. Now I want to see if the bulls can hold the recent minor low at 2250.

It’s a similar story for the S&P 500, except that it’s much closer to its minor low around 1,250.

The small caps actually broke their 50-day moving average yesterday but also gave a warning with that shooting star. I’m looking for support near 690…

Trend Table

Just one downgrade today…

Trend Nasdaq S&P 500 Russell 2000
Long-Term Down Down Down
Intermediate Down Down Down
Short-term Up Lat(-) Up

(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend

*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.