Head-and-shoulders topping pattern on the Technology Sector Index presents downside potential of 6%. Real Time Economic Calendar provided by Investing.com. **NEW** As part of the ongoing process to offer new and up-to-date information regarding seasonal and technical investing, we are adding a section to the daily reports that details the stocks that are entering their period of seasonal strength, based on average historical start dates. Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends. Stocks Entering Period of Seasonal Strength Today: No stocks identified for today The Markets Stocks dipped on Thursday as the rotation away from technology and into financials continued. The S&P 500 Index closed down by nearly nine-tenths of one percent, testing its rising 50-day moving average at the lows of the session. Momentum indicators continue to point lower as the end of quarter rebalance amongst portfolio positions acts as a drain on equity market strength. The true test of the strength of the market may be directly ahead as start of the quarter fund inflows seek a home in the weeks ahead. Continued rejection of the technology sector would be indicative of something greater than an end of quarter rebalance, where money managers are forced to sell the winners and buy the losers in an effort to bring allocations back inline with investment policy statement guidelines. With just one day left in the quarter, the S&P 500 Technology Sector index remains higher on the year by 16.5%, double that of the S&P 500 Index, which has returned 8.08%. Resistance on the technology benchmark has become apparent at the 20-day moving average and momentum indicators are trending lower, both presenting caution over the near-term. The index closed below its 50-day moving average for the first time since last November and a short-term head-and-shoulders topping pattern presents downside potential towards 885, or 6% below present levels, assuming the neckline and short-term support at 930 is broken. The drift lower in stocks was accompanied by a spike in the volatility index to the highest level since mid-May, although the volatility gauge did end well off of the highs of the day. In yesterday’s report we noted that it was likely that a spike from the low base would be realized in the near future as we enter the peak period for volatility in equity markets. Little did we expect that the spike would be realized so soon. Seasonally the VIX tends to rise from a low that is average around this time of year, climbing through the end of summer amidst a lack of favourable catalysts for stocks. Momentum indicators have been positively diverging from price over the past month and a half as the index realizes support just below 10. Turning to the latest Freight Index from CASS Information Systems, shipping activity through the first five months of the year continues to show a robust pace as goods are transported across the nation and the economy. The Shipments gauge rose 4.3% in May, more than double the average increase for the month of May of 1.9%. Meanwhile, the expenditures index was just shy of its May average, showing a gain of 0.9% versus a norm of 2.0%. Both benchmarks are showing a year-to-date change that is well above average, realizing the best start to the year since 2014. These shipping benchmarks provide a good gauge of broader economic activity, often acting as a leading indicator as both the raw materials and the finished goods are transported to consumers, eventually being picked up in calculation of Gross Domestic Product (GDP). Both the shipments and expenditures gauges peak for the year in September, on average, then drift lower through the fourth quarter. Sentiment on Thursday, as gauged by the put-call ratio, ended close to neutral at 0.98. Seasonal charts of companies reporting earnings today: No significant reports scheduled for today S&P 500 Index TSE Composite