US equity indices are settling into trading ranges rather than trending, according to analyst Declan Fallon. The S&P 500 held a bullish symmetrical triangle even as the Russell 2000 slipped under a key moving average, while the Nasdaq eked out a small gain.
The major US stock indices are drifting sideways instead of trending, and Declan Fallon argues the ranges are muffling the impact of recent losses — even sessions that closed lower on heavier selling volume. The picture across the board is mixed rather than decisive.
Small caps lead the losses
The Russell 2000 led the declines. The small-cap gauge fell 0.88%, and its tracking fund undercut its 20-day moving average on confirmed distribution, with the MACD and directional indicators weakening further. The index now faces its 50-day moving average as the next test.
The equal-weighted S&P 500 fared worse on the day, sliding 1.18% as it tagged its 20-day moving average and trendline support. Its broader technicals still read net positive, however.
S&P 500 and Nasdaq stay boxed in
The S&P 500 dipped 0.28% and continues to trade inside a broader range that also forms a bullish symmetrical triangle. The signals conflict: a supportive MACD and Stochastics sit against bearish On-Balance-Volume and directional readings.
The Nasdaq Composite bucked the trend with a 0.20% gain, shaping a consolidation inside its own larger range. Fallon expects the triangle to break upward, yet warns the risk of a failed breakout is high given the bearish backdrop.
Bitcoin caps the ranges
Bitcoin bounced from 57.5K and pushed back above its 20-day moving average, but it has since failed to clear 65K. Fallon frames it as the one asset where prior action does not favor buyers.
Across the indices Fallon says prior action still favors the bulls, yet the broader trend remains open for debate and prices should lead the decision.
Source: Investing.com
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