Chart of the Day - Wednesday, January 3, 2023

Today’s Chart of the Day was shared by Ian McMillan (@the_chart_life). Stocks are off to an ugly start in 2024. For starters, Santa never showed up. The S&P 500 has historically had below-average returns when Santa skips town. Seasonality aside, Ian points out that the major averages have trapped the Bulls with some nasty failed breakouts. The Russell 2000 ($IWM) has relapsed into its 2-year range after violating support at $200 today. The Nasdaq 100 ($QQQ) just had its best year since the dot-com bubble, and it broke out to all-time highs two weeks ago. However, it's also back below its respective breakout level ($400). These failed moves are a major red flag in the near term. As they say, "From failed moves come fast moves in the opposite direction."