Another day when Small Caps maintained their run of good form by closing above the August swing high, but buying volume was down on Thursdays. Technicals remain net bullish and have been since before the mini breakout in October. The only downside was the 'black' candlestick - a higher open but lower close; a close above prior day's close - 'black' candlesticks at a swing high typically mark reversals, so it will be important for buyers on Monday to make a close above the high of this candlestick to negate its potentially bearish implications. 

Yesterday's selling was a flash in the pan quickly undone by today's trading. The Russell 2000 sharply advanced, taking out the August swing high with technicals all firmly in the green. The only negative was the lower volume, but this is a marked advance after the successful test of the 200-day MA.

The Russell 2000 had shown the most promise into last week's close and followed that with a move past the most recent swing high - albeit on light volume. In doing so, it returned above its 50-day MA and brings into play the August high as the next challenge. Technicals are all net bullish, including relative performance. This is perhaps the best indication we have for a trade worthy rally as it looks to return above the all-time highs of 2018. 

All indices suffered selling on Friday, although selling volume was light, but given the Trump announcement after the Friday close it's hard to see anything but selling on Monday. The context to the selling will be a bounce that has struggled to reach the highs of August. Traders who were waiting for a retest of August highs before selling may find themselves doing this sooner. The lead in candlesticks to Monday will not help the mood. The Nasdaq looks to have finished with a bearish 'evening' start reversal. The 'buy' signal in the MACD, On-Balance-Volume and ADX are still intact, but I doubt all will survive by Monday's close. The 50-day MA is also support (for now). Stochatics are firmly on the bearish side of the divide (anything below 50 is bear market land). The index has also returned to a period of underpeformance relative to the Russell 2000.