Russel 2000 Index: Correction in uptrend

Even though the long term uptrend remains in play, investors should be wary of a significant shift in sentiment.

For the coming weeks a correction back to 1638 and even 1610 can be expected. This correction is classified as a counter trend move within the aforementioned uptrend. Significant support is found around the 1615<>1610 zone. Here former pivots, retracements and cloud support coincide. This zone must hold out in order to keep the long-term trend valid.

Since indicators (longer term) are becoming increasingly wary, investors should be cautious in maintaining large long-exposure. A larger correction beyond 1610 is becoming increasingly likely. We suggest tightening stops or even partially closing longs and await developments on the near term. Again, below 1615<>1610 things turn very sour.

  • Near term trend: negative
  • Long term trend: positive
  • Outlook:¬†correction in uptrend, possible reversal
  • Strategy: tighten stops and/or trading short
  • Support: 1638 / 1610 / 1580*
  • Resistance: 1710+
  • Outlook cancelled/neutralized below 1610

Weekly chart Russel 2000 Index (USA)