Large Caps Show Strength
It was a mixed bag for indexes, but with large caps leading the way as the S&P 500 and Dow Jones approached all-time highs.
Buying volume for large caps indexes wasn’t considered accumulation, but these indexes are outperforming their peers, hinting at underlying strength.
Dow Jones Index: Tight Consolidation
The Dow Jones Index is currently in a phase of tight consolidation following extensive gains. Despite the MACD showing a ‘sell’ trigger, the indicator remains comfortably above the bullish zero line.
Russell 2000 and Nasdaq Technicals
The Russell 2000 finished with a bullish harami, signaling further upward potential. However, technical indicators such as MACD and On-Balance-Volume are displaying bearish signals despite rising volume indicating accumulation.
Meanwhile, the Nasdaq is potentially bearish, making it crucial for the Russell 2000 to initiate a bullish move, which could mitigate selling pressure in the Nasdaq.
Russell 2000 Braces for Rally
The Russell 2000 has nearly closed the initial breakdown gap from the holiday selling period. This gap acts as a point of support or resistance, and its behavior could influence market sentiment.
Market Outlook
Despite large caps being at resistance levels, the potential for breakouts appears to be gaining strength, painting a bullish picture for the market.
