Thursday’s Market Overview: Russell Futures Showing Signs of Divergence, But Still Within Expected Range


  • Russell 2000 futures are showing signs of divergence from the other equity indices, as it rose yesterday while the other indices declined.
  • Russell is considered a higher-risk investment, and is currently within its expected range since mid-December.
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Yesterday, the Russell 2000 futures displayed a stark contrast to the other three equity indices as the market opened, with the /ES, /NQ, and /YM all experiencing a steep decline while the Russell 2000 futures rose.

Yesterday, the small-cap stocks posted the strongest performance of the day, however, they are now declining along with the other stocks due to the higher-than-anticipated Jobless Claims and the ADP Employment Report figures.

It is important to take note of the small-cap index, as it is considered a higher-risk investment, and can provide insight into the market’s overall trend.

Despite the recent volatility, the /RTY has stayed within a consistent range since mid-December, with a low of 1,730-1,735 and a high of 1,795-1,800.

The contract has been in a prolonged downward trend since December 2021, with few indications that it will be interrupted.

For the Russell to break out of its current range, it must rise above its 21-day and 63-day Exponential Moving Averages, which are currently at 1,786 and 1,805, respectively.

The downside point of the market remains at 1,730; beyond that, the triple-bottom near the yearly lows is between 1,640 and 1,650.

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