Stock Indices Break Support On Diverging Internals

As discussed in the last few Briefings, I am concerned over the lack of internal support on the current downtrend, especially volume. Volume in the Index ETFs and total volume continue to decline as price declines, suggesting the market is strengthening internally. While the decline appears to be impulsive in terms of price, it is not from an internal basis. Stock Indices broke to the downside in the short-term today and traded through important intermediate support before finding a stopping point and rotating. In the last thirty minutes of trading, buyers came in and then drove price back above those support levels. That was a surprising move based on the extent of the rally. Next week should be a very interesting week.

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