Yesterday's market action was positive.
The Nasdaq Composite dropped for a fourth straight day falling a further 0.31%, finding support at its 200 day moving average (Point A).
Dropping for a fourth straight day seems on the surface to be negative action however I was expecting the day to turn out much worse than it did. How the market acted yesterday was extremely positive and tells me that we may have some solid support at these levels (Point B).
Leading stocks action was positive. A greater number of leaders were rising in heavy volume compared to those that were falling in heavy volume. When you see this happen on a market down day, it is classed as a bullish divergence.
After yesterday's muted reaction to Apples missed earnings and sales expectations, it tells me that this correction could soon get back on track and start heading back higher. My short-term stance has switched to neutral. There is now a greater chance that the lows the market made on the 4th June (Point C) won't be breached.
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