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Warning Bells Are Ringing

|Includes: IWM, QID, QLD, PowerShares QQQ Trust ETF (QQQ), RWM, TBF, TBT, TLT, XLF

Signs are aplenty that the market is flirting with a major breakdown. The next couple of days should be telling. Nasdaq (NASDAQ:QQQ) was rejected at resistance in the form of both trendline and 50 day MA. QQQ has now completed the right shoulder of a pretty textbook Head and Shoulders pattern.

Small caps (NYSEARCA:IWM) are threatening to break support. Here is the IWM chart:

Perhaps more telling is the action in 30 year Treasuries (NYSEARCA:TLT), where TLT is breaking above resistance.

And finally, Financials (NYSEARCA:XLF) may finally be breaking down. Both a rising wedge and a Head and Shoulders top are in place as bearish harbingers for XLF. A test of 200 MA (the dashed blue line) should be a pretty big deal as there is a good bit of support around there.

Disclosure: I am long QID, RWM, TLT.

Additional disclosure: I am short XLF