Fri 16th May (9.40 am)

The more ‘risk sensitive’ of the US Indices is the ‘small caps’ Russell 2000 (RUT) and this is ringing a small warning bell again today. This index has closed again below the ‘neck line’ support of the 1,100 level. Whilst the daily candle here was bearish it did manage to close with a bit of bullish-reversal ‘Hammer’ look to it:

I will be more interested to see where this index closes for the week though so will be checking this again tomorrow. Any weekly Russell 2000 close below the 1,100 level would be a valid warning here and might be a bit like the proverbial ‘canary in the coal mine’.

The remaining major US indices are still ranging within their respective technical patterns and above daily support trend lines.

S&P500: this is still ranging within the ascending triangle pattern and above daily and monthly support trend lines. There is no major warning here just yet:

Dow Jones Industrial Index: This is much the same as the S&P500: ranging within the ascending triangle pattern and above daily and monthly support trend lines. There is no major warning here just yet either:

NASDAQ: this has pulled back to within the triangle pattern BUT is still above the major support of the 4,000:

VIX: this ‘fear index’ certainly looks like it has the potential to make a breakout move BUT this hasn’t evolved as yet:

Summary: The more ‘risk sensitive’ Russell 2000 index is looking vulnerable and may well be the first signal warning of a potential stock correction. This will need to be confirmed after the weekly candle close. There is no warning on the daily charts of the other major US indices yet but I will be assessing their respective weekly candles as well.