Two days of gains have helped re-establish the bullish technical picture for tech indices, Nasdaq and Nasdaq 100. While the improvement was welcomed it didn’t come without a price.
The Dow Jones (NYSEARCA:DIA) continued its good form, albeit on a small gain as it shapes a bullish handle (off an earlier handle). While above the breakout resistance level of 21,550 it will need more volume to confirm whether the move is valid.
The Russell 2000 (NYSEARCA:IWM) continues to be the index with the most potential energy to drive the next major market rally. Today’s ‘hammer’ next to 1,430 sets the tone for a strong Friday. Momentum players should take note.
Tomorrow will either prove to be a victory for shorts with channel resistance reversals for the Nasdaq or Nasdaq 100 or a win for the Russell 2000 and an opportunity for a solid 1%+ breakout style gain. Those are the indices and trades to watch.