We Need Juice

On the one hand, seeing the senior indices levitate even after a steep rally since Christmas is surely wreaking havoc on the hearts and minds of dedicated bears, buying index puts into each thrust higher seen in the DIA QQQ SPY. And NFLX battled back after earnings to slightly green/flat, alongside resurgent moves in large cap chips INTC QCOM on news.

On the other hand, the slippery intraday fades, lagging small caps, suddenly-very-weak biotech and healthcare complex is not making life easy for bulls, either. And now have some pressure on growth software plays this morning. 

From our vantage point, keying off the IWM, ETF for small caps housed in the Russell 2000 Index, continues to be of the utmost importance.

On the IWM daily chart, updated below, note the backtest of its 200-day moving average (yellow line, arrows) after reclaiming it earlier this month. If we see a harsh move back below it which is not immediately bought I would lean more towards the bear camp into next week after the long holiday weekend.

But that test is in progress now as we speak, and after another green open followed by an aggressive sell program for most stocks, we are back to wait-and-see mode to gauge just how much juice bulls truly have to sustain any type of momentum into the rest of the month.