The Long Walk Out

After a multi-session bounce, equities are cooling off a bit intraday here. The critical issue is whether this is simply the pause that refreshes the rally or instead marks some type of major lower swing high on the indices. 

Although the fifteen minute chart of the small cap ETF for the Russell 2000 Index probably will not directly answer that question, it does give us a good point of reference for the rest of the session insofar as keying off that $126 level. As you can see, small caps have taken the stairs up and were basing sideways as recently as forty-five minutes ago before some selling hit the tape and took them below $126. 

Acceleration below the level by bears would add credence to the idea of a further pullback this afternoon, while quickly recapturing by buyers likely marks another run-of-the-mill dip-buying frenzy.

As noted earlier, biotechs remain at the heart of the bull thesis into the rest of the summer, on the back of the CELG RCPT deal last evening.

In addition, bonds are finally bouncing a bit, as I have held off shorting TLT again for a while now given how beaten-down Treasuries have been. Still, after a relief rally I will be sizing up another potential short for Members, as we have played bonds twice on the short side successfully since late-April.