Not for the first time, we have markets edge a breakout before dipping below breakout support.
While indexes experienced heavier than typical selling on higher volume distribution, for the Russell 2000 (IWM) this amounted to a retest of cup-and-handle support, and a trend test for the Nasdaq and S&P 500.
If there was a risk of something worse, it was the potential breakdown in the Nasdaq rising trend. This breakdown will be confirmed if the index fails to recover by the close of business today.
The S&P 500 finished right on trendline support, and for day traders is the best call for a long opportunity today.
The rising trend remains our friend until proven otherwise. While yesterday's losses look damaging on paper, the opportunity on offer is one for buyers.