Tuesday, November 30, 2021

The week starts with weakness for the Russell 2000

Not the best of starts for the Russell 2000 as the opening gap higher drifted back into a lower close.  The finish was still enough to register support of the 200-day MA, but as long as sellers keep feeding piranha style on the carcass it will struggle to recover.  The index did enough to hold on to the 200-day MA but technicals remain net negative but stochastics are not yet oversold. 


The Nasdaq managed a bounce back to its 200-day MA - which while better than action in the Russell 2000 - there wasn't enough demand to see a close above this moving average. Technicals remain mixed but On-Balance-Volume is still trending higher and today's buying rated as accumulation. It needs a little more to mark it as a possible swing low, althoug a trading range from here is perhaps the most likely outcome. 

The S&P was able to reverse Friday's selling but it was only enough to take the market back to its starting point, pre-Thanksgiving. The index is trading juet below its 20-day MA but today's buying registered as accumulation - as with the Nasdaq, this may be the anchor point for a trading range to consolidate the October rally. 

The blip of Black Friday's action by the juniors has been erased, but its history remains evident on the chart. The best step forward would be for the S&P and Nasdaq to consolidate into new trading ranges to help consolisate the advances from October. The problem is the Russell 2000, which is staring dangerously close to the precipice and doesn't look like it wants to come back.  

You've now read my opinion, next read Douglas' blog.

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Investments are held in a pension fund on a buy-and-hold strategy.