MarketSmith powers the charts in this video.
QQQ and SPY broke out from a tight-range consolidation but they didn’t go very far as both are extended in the short-term perspective. Consolidations happen when buyers don’t want to chase the current prices but are willing to buy the quick 3-5% dips. Typically those types of consolidations resolve higher.
The small-cap index, Russell 2k is consolidating in a tight range right below its 200-day moving average. If it finally breaks out and starts trading above its 200dma, we are likely to see many faster movers among the more speculative, highly-shorted stocks like LMND, AFRM, CVNA, IOT, etc.
Nvidia crushed earnings estimates and raised guidance again. It didn’t break out on the news because it was already up 25% in the three weeks preceding the report. It could test 475-450 before it attempts to break out above 500-510 again.
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