Nasdaq explodes, S&P 500 hesitantly follows – Russell 2000 lags behind

He stole the show yesterday. The tech index broke through resistance with a significant price jump, sending a bullish signal to the markets. The breakout gap has been confirmed and is unlikely to be closed. This brings a new goal within reach.

It looks like yesterday’s gap (NYSE:) could not only be a breakout signal, but also a so-called “measuring gap” – a technical signal that points to further gains. If this effect prevails, the 20,500 points could soon be reached. This scenario is supported by an improvement in relative strength compared to the . The technical situation therefore remains clearly positive.

It also gained yesterday, but narrowly missed a new high. Nevertheless, there are positive signs: The strong Nasdaq rally could pull the broader market higher, as was the case at the beginning of October.

At that time, the previous breakout was supported without causing a critical pullback. A new test of the breakout support would also be conceivable now without clearly falling below the 6,000 point mark. However, a brief intraday slippage would be manageable.

On the other hand, things were disappointing. A hoped-for recovery on the 20-day line failed to materialize. Instead, yesterday’s “black” daily candle showed clear weakness. However, such candles are only really problematic at high points – and the index is currently in a downward movement.

However, the technical situation remains tense. If the Russell 2000 does not return above the 20-day line soon, there is a risk of a pullback to the open gap at $225. After all, the momentum indicator continues to show a slight bullish bias, giving the bulls one last chance.

Another strong rally in the Nasdaq might be asking too much after yesterday’s jump. But the Russell 2000 now has the opportunity to show strength. The S&P 500 could also follow suit in the current environment and attract fresh buyers at a new high.

The markets remain on the move – and with a bit of luck the Christmas rally will start earlier than expected. Santa Claus is on his way…