Late Sell Off, Bears Hold The Edge For Tuesday
Declan Fallon | Aug 26, 2013 03:59PM ET
A disturbing late day sell off killed the attempt by bulls to regain key moving averages. Volume was light, which was of some consolation, but the rate of decline pointed to some big selling. Potential Syrian intervention was attributed as the cause of the selling, but markets still have some room to fall before becoming measurably oversold.
The S&P will be looking at a test of 1,639, but tomorrow will offer another chance for bulls to regain the 50-day MA. Stochastics did regain bullish territory despite today's sell off.
The Nasdaq closed with what could be seen as a 'gravestone doji'. The index is above its 20-day MA, but today's bearish candlestick suggests this will be tested tomorrow. Today was also accompanied with a 'sell' trigger in on-balance-volume, another sign of a probable bearish move on Tuesday.
Finally, the Russell 2000 was rebuffed at the 20-day MA with a gravestone doji of its own. The proximity of the 50-day MA makes this a downside target, probably for Thursday.
Bears should hold the edge for Tuesday.
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