One step forward, two steps back. The only consolation to yesterday was that trading volume was down on Thursday's. The NASDAQ is holding circa 14,900 support while the S&P 500 was able to find buyers around its 50-day MA - but not before it undercut breakout support. Meanwhile, the Russell 2000 didn't make it past neckline resistance.
Despite the loss of breakout support the S&P has two chances to recover the losses; the first is where the index finished today - at its 50-day MA, the second is channel support - currently around 4,650. We do have 'sell' triggers in the MACD and On-Balance-Volume, but momentum remains on the bullish side of the midline.
The NASDAQ undercut rising channel support but did defend the swing lows from December, but just as triple tops are a rarity (i.e. breakouts usually occur on the third test of the double top), we have to consider we won't have a triple bottom - so look for a test of the 200-day MA. Technicals are net bearish and there is a sharp loss in relative performance against the S&P.
The Russell 2000 was rebuffed by neckline resistance off the double bottom and its 50-day MA. It still has a few days before it gets to test the double bottom but technicals are mostly negative. The one key advantage for bulls is the relative outperformance against the NASDAQ (although still underperforming against the S&P). The index has plenty of work to do before it can challenge its November highs. If there is going to be an extended decline (across indices), then the Russell 2000 is going to be the one to lead indices lower.
As we head into the end of week markets have an important decision to make; will buyers be able to wipe out Wednesday's losses, or will sellers push another round of selling? The weekly candlestick will be interesting.