The very first step to any would-be corrective activity is to lose the EMA 10?s.  That is the gold line on this chart of the Russell 2000.  NFTRH has been noting 1) Over enthusiastic dumb money sentiment 2) fading participation and 3) a divergence by junk-quality bond spreads.

Finally, the first scant technical evidence of a disturbance is manifesting in the Small Caps, along with the Biotechs.  Items like the Banks and Semi’s have flirted with their EMA 10?s but remained above them, and the headliners INDU, SPX and NDX hover well above theirs despite their diverging Participation indexes.

This pig will be ready to take a hit if more of these short-term EMA’s start to get pierced.

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