Since October there has been a back-and-forth tussle in the relative strength leadership between the Nasdaq and Russell 2000. The Russell 2000 awoke from its slumber at the start of November and this helped drive the broader rally across markets as it adopted a leadership role. The breakout in the Russell 2000 has since drifted into a consolidation, and this stall has returned a leadership opportunity back to the Nasdaq and S&P - one which the Nasdaq is taking. 

The Nasdaq has bullish technicals and a relative uptick against Small and Large Caps. Today's gain didn't reach 1% or register as accumulation, but it's getting closer to challenging the November peak high of 16,053. With buyers pumping money into the index it may be the first to make new all-time highs. 

The S&P did manage an accumulation day as it too outperformed the Russell 2000. Aside from the MACD, all other technicals are positive. The extent of the pullback from highs - after a hefty run off 4,278 - is probably not enough to see the rally continue as it did before, so we may be looking at sideways action or more downside as traders continue to take profits off the run up. As it stands now, just below the last peak, it's in a bit of no-mans land. 

Not surprisingly, the Russell 2000 trades in a narrow range as it consolidates its breakout. Of all the indices it's best positioned to advance further as it's still early days for its rally. Despite the trading range, supporing technicals are net postive and there may even be a long trade with a stop below today's low. If there are further loses, then breakout support around $232 ($IWM) will be the next test.

Today's action was a nice counter to yesterday's selling. Both Nasdaq and S&P are building new rallies but it's Nasdaq which has stuck its neck out in front. Let's see if proves to be the one to make new highs.