All the major averages are now in a technical correction. The IWMs (top chart) have dropped 12.6%, the QQQs have dropped 11.8% and the SPYs have dropped 9.5%. All are now below their respective 200 day EMAs with the shorter EMAs in a bearish orientation. RSIs are weak, MACDs are declining and CMFs are negative. About the only positive thing on all of these charts is the declining BB width, indicating that volatility is dropping.
Two of the largest -- and most important -- market sectors share the same characteristics. The financials (which account for about 14% of the SPYs) and the technology sector (which accounts for about 19%) either just below or completely below the 200 day EMA. The financials are susceptible to drops caused by the Greek/EU crisis, while the technology sector is getting hit by risk aversion and profit taking.
