Weekly Market Commentary: Santa Rally

The swing low in the market firmed up with a strong advance off an oversold breadth state. In the case of the Nasdaq, breadth moved from oversold into a neutral state, but continued the advance higher. Breadth has plenty of room to run before it turns overbought.However, the Santa Rally may not last long into the New Year, as the NYSE 52-week low is well away from a typical strong swing low.The index to watch over the course of the Santa Rally is the Russell 2000.  The recent breakdown reversed into a 'bear trap', and is ready to challenge 868 resistance for a third time (lucky!).  Small Caps have had a quiet 2012, so 2013 could be their year.The S&P also is working off a bear trap, and is in the process of completing a higher swing low - and perhaps - a new, higher swing high.While the Nasdaq is range bound, but a move to challenge 3,196 should be supported, given the rela...