Wednesday's recovery set the groundwork for a bounce but the gap higher took away most of the opportunity the bullish set-up offered. Weakness at this point would be bearish so I wouldn't be buying but rather hold until the morning breakout gap closes and reassess.
The S&P generated a small uptick in relative performance but not enough to trigger a 'buy' signal yet. Other technicals are mixed with 'buy' signals in the MACD and On-Balance-Volume are offset by 'sell' triggers in +DI/-DI and Stochastics.
The NASDAQ kicked off a new bounce with the MACD recovering a little but all other technicals are net bearish. Still much work to do with the index trading inside the range.
The Russell 2000 experienced a modest gain as the bounce developed. The risk:reward is still favourable for bulls with a stop on a loss of 1,539 and an expectation for a break from the triangle and a move higher.
The Dow Jones may have laid a preliminary 'bull trap' but the index remains above the downward channel. Volume was light although the 'tweezer low' is still in play. Bulls still have a workable edge here.
For Friday it will be about building bullish momentum on Thursday's action. The Dow Jones Industrial Average and the Russell 2000 are perhaps best placed for bulls to push their advantage.