Wednesday’s news was not the continued losses from the bearish wedge in the as such losses have remained contained by the trading range. Before moving on, the Russell 2000 (via ) does have the 200-day MA to look for as a possible positive test despite the net bearish technical picture.
![IWM Daily Chart IWM Daily Chart](https://dasforex.com/wp-content/uploads/2021/08/picd79a68c42d56e52511698887e6d868ea.png)
IWM Daily Chart
Yesterday it was the which was perhaps the most disappointing. It had finally marked a breakout after a 3-month consolidation, which should have set it up for a nice run.
However, Wednesday saw this breakout get washed away with an undercut and close below breakout support. Yesterday’s loss came with a ‘sell’ trigger in the MACD and ADX.
Despite this, it’s not totally a goner. The index is outperforming the and will soon be testing its 50-day MA. ‘Bull traps’ tend to be powerful topping patterns and if this evolves into something worse it will spell bad news for the and probably the too.
![DJIA Daily Chart DJIA Daily Chart](https://dasforex.com/wp-content/uploads/2021/08/pic7b8e4211e0d1f1e3f3a935420bfda11b.png)
DJIA Daily Chart
The NASDAQ took a loss to take it to its 50-day MA, but remains well above June breakout support. Look for an intraday spike below its 50-day MA but a close above as I would expect to see some form of positive test here.
![COMPQ Daily Chart COMPQ Daily Chart](https://dasforex.com/wp-content/uploads/2021/08/pic11e8c6d798d210974ff5f8f4d82e3454.png)
COMPQ Daily Chart
The is in a last chance saloon with rising support the only thing separating the index from its 200-day MA. The larger issue is that the index is back inside the prior consolidation, negating the breakout and setting up a likely move back to support of the March swing low. Technicals are net negative, confirming the weakness.
![SOX Daily Chart SOX Daily Chart](https://dasforex.com/wp-content/uploads/2021/08/picf9d1527b3c2318342cd62dd6c0cda956.png)
SOX Daily Chart
While weekly charts aren’t showing a whole lot of damage in the markets, but we do have a scenario where there is little incentive for sideline money to step in and buy ‘value.’
Pullback ‘buys’ require a clear trend to feed into this and the July swing low was that opportunity, but there was no continuation of the rally when it came to challenging the all-time high. Defensive sectors remain the best chance for longs; I am tracking some here.
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