Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Bull Flag Breakouts in Nasdaq, Russell 2000 and S&P 500 Hit a Road Block

Published 02/17/2023, 02:41 AM
Updated 07/09/2023, 06:31 AM

Yesterday's gains offered classic 'bull flag' breakouts, but today put a damper on many of those market moves.

Russell 2000

The Russell 2000 opened near the low of Wednesday. Despite an intraday surge to yesterday's highs, it closed just below its open price - registering a distribution day in the process.

Technicals haven't changed, although relative performance is improving against the Nasdaq.

Russell 2000 Daily Chart

Nasdaq

The Nasdaq closed near yesterday's lows, undoing that nice, big breakout candle. There is still the MACD trigger 'sell,' but other technicals are okay, and there was no confirmed distribution for today's selling.

Nasdaq Daily Chart

S&P 500

The S&P 500 had the weakest finish. It just edged a 'bull flag' breakout yesterday and took a larger loss today. Adding to the malaise was a relative performance loss against the Russell 2000. Selling volume climbed to register as distribution too. Yuck...

S&P 500 Daily Chart

The net sum of today's action was to reverse the 'bull flag' breakouts but not undercut the more important resistance breakout.

Having said that, I would view today's end-of-day close as a set-up for future losses. While I would tolerate any intraday violation of nearby breakout support, I wouldn't want to see an end-of-day finish below these levels for any index.

Latest comments

Our author is moon boy. this article translates we shud all stop working and do trading coz markets never go down l. Let's bet, 3200 S&P
Volume too low to be a breakout,  look at futures now  which prove  fakeout
Declan, you should consider using the days of the week instead of "today" and "yesterday." Your article is dated February 17th, Friday, but the US markets haven't even opened yet, so "today" does not describe the day you are talking about. You mean Thursday.
bull flag??? march meeting 50bps and may 100bps and wait if putin doesnt made something stup...d
yep, that is the shape of a bull flag... if it continues up. if not, the bull flag is negated. the rest of the commentary indicates that the market is at an important inflection point
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.