The Russell 2000 took this a little further. Yesterday's selling was far more evident in this index, but today's reaction maps with the strong relative strength swing to Small Caps from Tech and Large Caps. The potential for a measured move higher is on offer - this time a stop on a loss of 'bear trap' lows is the risk.
The Nasdaq is the safest of the long side opportunities given it never lost its breakout yesterday. Today's buying was supported with higher volume accumulation.
With shorts again out of the loop it's left to bulls to drive the advance. Today's big gains may consolidate over the next few days, but it will important 'bull traps' don't return soon as markets don't take kindly to such mood swings.
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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
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