Major averages got hit hard on higher volume Friday after China allowed short selling while restricting margin buying which increases the supply of stock, and news hit that Greece may default on its debt. Friday was options expiration which added to the total volume traded. Both the S&P 500 and DJIA closed under their respective 50-day moving averages while the NASDAQ Composite found support at its own 50-day line.
This pullback may be short lived as the Greek debt default situation has been a bit of a broken record, and China's decision will curb the buying frenzy that has taken hold in the Chinese markets since March, but should leave other world markets relatively unaffected.
Nevertheless, markets are in their trading ranges and may need a little time to heal. Futures are up about 0.4% at the time of this writing on news that China is lowering reserve requirements for its banks.
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