The Russell 2000 is on the verge of a breakdown

The Russell 2000 is poised for the lowest weekly close since November 2020. It’s fallen in four straight weeks and seven of the past eight.

It’s trading at 1646, which is just 0.3% above the 1641 intraday low in June 2022. The index is down 0.6% today. If that level breaks,we could be in for a world of technical hurt. The range in the Russell 2000 has been carved out for 18 months with both sides tested multiple times.

To tie it back to fundamentals, a breakdown in the index would indicate a recession along with the Fed keeping rates stubbornly high. That’s certainly a plausible scenario for 2024.