The idea that Christianity supersedes Judaism is found most clearly in Paul's letters and the gospel of John and Acts. It's not noticeable in the synoptics (Mark, Matthew, Luke) and indeed in Matthew 5 it's flatly contradicted:
Certainly, Christianity started out as a Second Temple Judaic sect.
But it was a very peculiar one in its cultural context.
To be a bit more specific, scholars typically accept that Jesus did abrogate a limited number of mitzvot of the Torah by his own authority: namely the laws on oaths, the Sabbath (he declared himself 'lord of the Sabbath' in the Gospel of Mark and said that the "sabbath was made for man, not man for the sabbath"), the Mosaic law on divorce and the "lex talionis" (the Torah, in an attempt to limit vengeance, prescribes proportionate "eye for eye, tooth for tooth" punishment in retaliation for a crime, whereas Jesus overrules it with 'turn the other cheek' and not responding with any legal redress, even proportionately).
But he didn't abrogate the entirety or even arguably the substantials as St. Paul, in principle, later allowed for (i.e. making it effectively a matter of 'conscience' whether one adopts it or not, outwith the moral, and certainly not binding on Gentiles), even though his 'example' set a precedent. The saying you cite (as does @adrian009) establishes Jesus's high praise for the "law", even as he exercised a very uncommonly liberal approach to halakhah that I imagine many of our Jewish friends would find very unorthodox. Interestingly, with regards the historical Jesus, your above quotation is commonly regarded as a Matthean re-working of the underlying Q source he shared with Luke, and scholars believe that Luke's "unified and briefer version is more primitive than Matthew's...Luke's version is not a redactional combination".
The Matthean version has an explication ("until all is fulfilled") that is uniquely Matthean in syntax.
Matthew's gospel was, apologetically, concerned with trying to prove Jesus fulfilled Hebrew scripture and is overwhelmingly regarded as addressed to a still Torah-observant community.
The Lukean version is much less honorific of the law: it begins with a clear statement to the effect that the Torah and Neviim were "in force" until John the Baptist comes but since his ministry the 'kingdom of God' has taken their place. We then have a much shorter, single sentence qualifying this radical abrogation about it being easier for heaven and earth to vanish than a letter of the law "failing".
Matthew, for his own homiletic reasons, appears to have greatly expanded this simple saying into an elaborate defence of the law.
If I may quote the historical Jesus scholar Dale Allison in his The Earliest Christian Tradition and Its Interpreters:
"Another line from Q that raises questions about Jesus's faithfulness to the law is Q 16:16...Within Matthew's Gospel, with its unambiguous endorsement of the Torah in 5:17-20, this saying is difficult to interpret...The rhetoric is provocative - deliberately so, one suspects - and interpreters from early times have seen in Matt 11:13 and its Lukan parallel an implicit criticism of the law...Q.16:16 does assume a displacement. The Law and the Prophets are no longer the center of religious attention; something else - the kingdom - now is the center. The radical Jesus appears not only in Mark and Q....One feels the law's inadequacy even in Matthew's Gospel...When Jesus formulates his imperatives as contrasts with Moses, he is clearly signaling that Moses does not suffice....
[The conclusion] Jesus did not compose Matthew 5:17 with its ringing endorsement of the Law and the Prophets." (p.176)
[The conclusion] Jesus did not compose Matthew 5:17 with its ringing endorsement of the Law and the Prophets." (p.176)
What Jesus did do, however, was leave an 'explosive' saying attested independently by Mark, Luke and Paul in his letter to the Romans, which Paul readily cited and used to effectively render the entirety of the cultic laws of the Torah a matter of conscientious determination decades after Jesus's death (even though Jesus certainly didn't do this himself).
In Mark 7:14, 18-23 Jesus says, “There is nothing outside a person that by going in can defile, but the things that come out are what defile...Nothing that enters a man from the outside can defile him, because it does not enter his heart, but it goes into the stomach and then is eliminated.” (Thus he declared all foods clean)...What comes out of a man, that is what defiles him.For from within the hearts of men come evil thoughts...All these evils come from within, and these are what defile a man".
That last line in parenthesis, "thus all foods are clean" is a Markan interpretative remark that Jesus's command here effectively abolished the theoretical basis of kosher, even though Jesus doesn't say it explicitly himself and the church after his death had a serious battle of ideas over this, as signified by the Council of Jerusalem in Acts.
Luke's gospel and St. Paul (decades before Mark) attested to different, independent variations of this same teaching (making it one of the most authoritative and ancient Jesus sayings by multiple attestation):
"Now you Pharisees clean the outside of the cup and of the dish, but inside you are full of greed and wickedness. You fools! Did not the one who made the outside make the inside also? Instead, give for alms those things that are within; and see! everything will be clean for you" (Luke 14:39-41)
“I know and am persuaded in the Lord Jesus that nothing is unclean in itself; but it is unclean for anyone who thinks it unclean" (Romans 14:14)
“I know and am persuaded in the Lord Jesus that nothing is unclean in itself; but it is unclean for anyone who thinks it unclean" (Romans 14:14)
So it would be erroneous to imagine that St. Paul pioneered this approach as a complete "novelty" without precedent in the Jesus oral tradition. Rather, he had Jesus tradition available that he could cite and which those with whom he debated also regarded as 'true', to buttress his interpretation even though it was far more radical than Jesus himself.
The relationship between Jesus and the Torah, in his lifetime, is thus far more complicated than your post would suggest.
It also needs to be noted - as attested also by Paul in his letter to the Corinthians, as well as in the synoptic gospels - that Jesus only announced a "new covenant" on the night he was betrayed to death, during the Last Supper with the institution of the Eucharistic ritual. St. Paul's version of this Jesus tradition and words of institution:
"For I received from the Lord what I also handed on to you, that the Lord Jesus on the night when he was betrayed took a loaf of bread, and when he had given thanks, he broke it and said, ‘This is my body that is for you. Do this in remembrance of me.’ In the same way he took the cup also, after supper, saying, ‘This cup is the new covenant in my blood. Do this, as often as you drink it, in remembrance of me.’ For as often as you eat this bread and drink the cup, you proclaim the Lord’s death until he comes." (1 Corinthians 14:24-26)
Luke's later version of this story:
"After taking the cup, He gave thanks and said, “Take this and divide it among yourselves. For I tell you that I will not drink of the fruit of the vine from now on until the kingdom of God comes.”And He took the bread, gave thanks and broke it, and gave it to them, saying, “This is My body, given for you; do this in remembrance of Me.” In the same way, after supper He took the cup, saying, “This cup is the new covenant in My blood, which is poured out for you." (Luke 22:17-20)
Luke's later version of this story:
"After taking the cup, He gave thanks and said, “Take this and divide it among yourselves. For I tell you that I will not drink of the fruit of the vine from now on until the kingdom of God comes.”And He took the bread, gave thanks and broke it, and gave it to them, saying, “This is My body, given for you; do this in remembrance of Me.” In the same way, after supper He took the cup, saying, “This cup is the new covenant in My blood, which is poured out for you." (Luke 22:17-20)
Thus, the most significant act of "old covenant" revocation - the declaration of a new one, centred around a new religious rite/ritual that has no precedent in the Torah - only happens the night before Jesus dies! So its understandable why the early church, before St. Paul reconciled all the inconsistencies into a concrete stance in the 50s CE, were unsure of what their relationship with the Torah exactly was for about decade or so after Jesus's death. The destruction of the Second Temple in 70 A.D. merely capped a process of separation into an entirely new religion that had long been in the offing, theologically.
In principle, when Jesus makes the statement you quote above from Matthew - at least according to Matthew - he is speaking before the announcement of a "new covenant". This makes his limited but significant number of Torah violations even more significant, because he was literally portraying himself as "above" the law when he acted in this way.
Then we have the most significant Jesus saying from the synoptic tradition on the "old" versus "new" teachings:
New Wine into Old Wineskins - Wikipedia
No man putteth a piece of a new garment upon an old; if otherwise, then both the new maketh a rent, and the piece that was taken out of the new agreeth not with the old. And no man putteth new wine into old bottles; else the new wine will burst the bottles, and be spilled, and the bottles shall perish. But new wine must be put into new bottles; and both are preserved.
— Luke 5:36-39, KJV
This parable about new wine needing "new wine-skins" (because the new wine would burst the old skins, unless they are replaced) is recognised by most scholars as Jesus proclaiming that the "kingdom of God" he preached represented a new 'stage' (of some kind) that surpassed that of Moses and his covenant. On the night before his death, as first attested by Paul in his letter to the Corinthians before the accounts in the synoptic gospels, Jesus shared a final meal with his disciples at which he lifted up a cup of wine and declared that there was now a "new covenant".— Luke 5:36-39, KJV
In other words, acting out this earlier parable and making a ritual involving wine the new central 'rite' of his sect. And these were by far the most 'offensive' words Jesus could have used under the Old Covenant, in which 'blood' was absolutely forbidden to be consumed:
Leviticus 17:10
If anyone from the house of Israel or a foreigner living among them eats any blood, I will set My face against that person and cut him off from among his people.
If anyone from the house of Israel or a foreigner living among them eats any blood, I will set My face against that person and cut him off from among his people.
As one Jewish scholar notes:
"If anyone eats blood, that person must be cut off from his peers.” The ban on eating blood is fundamental to the Torah. The ban occupies a central place in the covenant."
On the same night where he declares the Torah an 'old covenant' and announces a 'new covenant', Jesus refers to the wine in the cup as his "blood", as if to ram the point home (symbolically?) that the Old Covenant really is surpassed by a New one for his band of disciples.
There are other examples:
Luke 16:16-18. The law and the prophets were in force until John: since that time the kingdom of God is preached
Jesus's relationship with the law is therefore complex beyond complex. I'm forever thankful that St. Paul simplified everything into a coherent theological framework!
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