Pro Charts: Stocks & ETFs

Russell 2000 Chart Shows Ominous Bearish Pattern Formation

Updated: Jun 08, 2024 | Published: Jun 08, 2024
Verified Investing
By Verified Investing
Russell 2000 Chart Shows Ominous Bearish Pattern Formation

While the S&P 500 and the NASDAQ have been hitting new all-time highs, the Russell 2000 has been left in the dust. This signals that the rally in both the S&P and NASDAQ has been driven by a few stocks. As all investors can guess, it is the trillion-Dollar stocks like Nvidia, Apple, Microsoft, Amazon, Meta Platforms and Alphabet.

Investors should always remember, the S&P is just five-hundred stocks, the NASDAQ 100 is simply one-hundred stocks yet the Russell 2000 is two-thousand stocks. This means that the Russell 2000 is a much wider sample of the U.S. economy and could be more realistic for the actual performance of the market.

With the Russell 2000 not making a higher high since the all-time high in 2021, investors should be wary. In addition, there is a bearish pattern formation called a head and shoulders. The head and shoulder pattern is bearish upon breakdown. If this pattern triggers, it likely signals further downside in the Russell 2000 and could spell trouble for the overall markets if the trillion-Dollar stocks stop carrying the load.

Verified Investing prides itself on alerting investors to technical analysis pattern formations, data and chart signals. Their goal is to provide unbiased chart analysis unlike the mainstream media narratives or social media hype. Verified Investing fights for the retail investor, helping them succeed in trading and investing.