The Russell 2000 (IWM) has been running along the upper path of ‘bear’ flag resistance and the ‘black’ candlestick today piles on to the bearish ‘cloud cover’ from Friday. Another day’s worth of losses would drop it back inside the ‘bear flag’ and leave it vulnerable to a move back to ‘bear flag’ support. Technicals are net bullish.
The S&P also found itself toying with a challenge of the 52-week high. Technicals for this index are also net bullish and today’s selling volume was relatively modest.
While today tacked on a second bearish day on to Friday’s, we do have broader rallies that started from an oversold (and vulnerable) state, that bypassed the zig-zag correction risk, and now appear to be playing out as peaks in sideways consolidations. We could of course blow past these levels and continue with the rallies started in late 2023, although it does feel a little tired for this. The lack of trading volume plays into this, that in itself, leaves markets open to any major volume move.More By This Author:Bearish Candlesticks Friday Do Not Necessarily Translate Monday Markets Peaked Yesterday, But Today Wasn’t One For Sellers Indices Look To Escape ‘Bear Flags’ As Resistance Levels Get Chalked Off
