Markov & The Russell 2000 'Golden Cross'

One of the more popular technical analysis tools signaling bullish sentiment in an instrument or index is the "Golden Cross" - when a 50-day moving average moves above the 200-day moving average of the same instrument.

That's exactly what happened on Jan. 18 of this year with the Russell 2000 index, and pundits began to to talk about the return of the bull rather than the bear in small-caps.

But if you were using Excalibur's Markov tool, you would have seen an important development that began on June 17, 2022 - more than 6 months before. That's when Markov showed a state switch that remained in place through Feb. 3 (barring a two-day reversal in early November).

Since that Markov switch in June, the Russell 2000 has been up 19.2% through Feb. 3.