Tuesday's market action was a win for the bears, negating Monday's win for the bulls. This increases the pressure on the pivotal situation the Indexes find themselves in right now. Looking at the top chart cluster, below, the midterm channels overall are still holding, but looking a little heavier. The Russell 2000 (via iShares Russell 2000 Index (ARCA:IWM)) actually started to lose its channel going into the bell yesterday. After hours, the SPDR S&P 500 (ARCA:SPY) and PowerShares QQQ (NASDAQ:QQQ) took a noticeable drop.
Looking at the second cluster below, the EMA charts, we can see that yesterday really needs to be a day for the bulls because the upper day chart EMAs are getting dangerously close to a down cross. Skipping down to the VIX charts, we see it's still managing to maintain its upper momentum.
All in all, Tuesday needed to be at least a sideways day, but it wasn't. This puts tremendous pressure on today's market because if it starts with a gap down and doesn't recover then we could see the day EMA charts start to show the beginning of a down cross which could easily trigger big sell programs. The market really needs a 3 AM Team Yellen intervention on the SPY as they have done so many times before at critical junctures.