On the daily chart below for the Russell 2000, we can see that after rallying back to the 50% Fibonacci retracement level, the market found again a strong resistance and started to fall as issues with the First Republic Bank, the strong ISM PMIs, the miss in Job Openings and a Fed that left the door open for further hikes weighed on the sentiment.

What saved the day was the NFP report on Friday which was much better than expected and gave the market soft landing vibes.

Russell 2000 Technical Analysis

On the 4 hour chart below, we can see that the market is stuck in a range between the resistance defined by the 50% Fibonacci retracement level and the support at 1723. We can further see that the price was diverging with the MACD falling into the 1723 support, which was a signal of a weakening momentum often followed by a pullback or a reversal. The buyers are now in control and the likely target is the 50% Fibonacci retracement level.

On the 1 hour chart, we can see that the price action has been choppy and at the moment is hard to find clear entry points. What is clear is the range, so the market should go with the flow once the price breaks out on either side. This week the big event is the US CPI report on Wednesday. The likely outcomes are a rally in case the data misses expectations and a selloff in case the data beats as the market would start to worry about another wave of inflation and a more hawkish Fed.