Russell 2000 Holding the 50-day SMA

TVC:RUT   US Small Cap 2000 Index
The Russell 2000 had a strong move coming out of the vaccine news in November. It’s been consolidating for the last two months and now may be ready to continue higher.

The main thing jumping out of today’s chart is the 50-day simple moving average (SMA). RUT tested it in early March and has chopped on either side of it since. But now prices are trying to hold it as they squeeze into a tight range.

Second, notice the relationship with the 10-day SMA, which is rising up toward the 50-day SMA. Other times when it crossed above in May and October were followed by periods of strength.

Finally, notice how the MACD histogram has inched back from bearish toward neutral. Like the 10-day SMA versus the 50-day SMA, it hasn’t crossed yet. But it could be worth watching.

Overall, the data seems to be confirming the economic recovery and restrictions are loosening in various jurisdictions. Small caps have been one of investors’ favorite ways to position for that reopening trend, so buyers may return as the summer approaches.

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