After Monday’s massive move (the biggest on record for the SPX), we close Tuesday with a small loss.

Key now is volume. It’s a problem for Bulls that Monday’s move wasn’t on heavy volume, and even more of a concern that Tuesday was a distribution day (where heavy selling indicates institutions aren’t supporting this market.)

As intermediate-term traders we are now looking for a Follow Through Day (FTD), where beginning Thursday a move of at least 1.7% on one of the major indexes is accompanied by accumulation (buying volume greater than the previous day’s.)

An FTD will give us a clue that institutions are supporting the long side of this market. Perhaps setting up for a fall rally.

If not, we focus on finding the best short candidates.