Send 2000 daily
This is what a regime change in the stock market looks like.
On Wednesday, the Russell 2000 rose on the back of a weak CPI report and rose yesterday on the Producer Price Index. But here we are at the lows of the week and at a six-week low, reversing a 2% gain.
For 18 months, the market has been trading higher due to falling CPI, but after a significant slowdown in the latest data, this shows that the system is over. The market has outgrown inflation and is now more concerned about growth. The Russell 2000 is cyclical and not the market beneficiary of the first wave of AI (although I believe AI-based automation will eventually pay dividends).
So this chart is what you get, with a break of support after a stop before the 2100 level and several failures to break above that level. It is also possible that the chart will form a head and shoulders top with a target of 14% downside from here.
It doesn't look great here in the short term, but this head and shoulders is not a done deal. There is a series of higher lows so far this year and some consolidation above the old 2022-23 range that peaked near 2000.
I'll be watching closely next week.