Heading into Wednesday morning, we began to see confirmation of a slowdown in the momentum of upside action. This created a higher chance for a choppier intraday session. It was not quite as difficult as when this same type of action took place a week earlier, however, and the market managed some decent intraday moves throughout the morning before the struggle became more difficult into the afternoon.
The market corrected off premarket highs into around 10:30 a.m. ET. This took it back into support at the lower end of the larger 15 minute uptrend. The Nasdaq had the steepest retracement, but the price action was smooth and the reversal off morning lows allowed for strong daytrade action on the upside. The Nasdaq is currently the least extended of the three major indices on the daily time frame, so we could easily see it take over as the market's leading index heading into the weekend as it plays "catch-up" while the S&P and Dow struggle at prior highs.
Both the S&P 500 and Dow Jones Ind. Average futures had struck resistance once again at the upper end of the 15 minute channel in the early afternoon and this is the third strike (seen most clearly in the Dow futures) on the 15 minute time frame on the third leg up on the 60-minute time frame. This leaves the index's trend very extended and in favor of a reversal within the next several days, although it can still round off some at highs before there is a larger price correction once again on the daily charts.