Bullish Reversals, But Markets Not Out Of The Woods

Published 03/10/2022, 01:34 AM
Updated 07/09/2023, 06:31 AM
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US2000
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Just as the selling meant indices were not as weak as headlines suggested. Likewise, yesterday's buying was not as good as the media would suggest either. However, it did at least stall the break of the most recent swing low.

The NASDAQ has made its way back to declining resistance of the slow forming wedge, but technicals are all bearish and it remains some way from a bullish 'buy' in relative performance to peer indices.

COMPQ Daily Chart

The S&P 500 has also bounced off Wednesday's modest selling, but it's a long way from breaking the downward trend. Technicals are net negative along with relative underperformance.

SPX Daily Chart

The Russell 2000 returned to its trading range after a gentle nudge into a 'bear trap' challenge, before it rallied back to its 20-day MA. Yesterday's buying volume was light, but there is a strong relative outperformance along with the MACD 'buy', along with a pending 'buy' in On-Balance-Volume. 

IWM Daily Chart

I remain of the opinion markets are shaping a trade worthy swing low, the Russell 2000 in particular, but yesterday's buying didn't do enough to challenge pre-existing resistance. There is still a chance we will see such a challenge before the week is out, but there is much work to do.

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