Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Friday, December 25, 2015

Russell 2000 Testing Longterm Channel Line

The Russell 2000 has been having a tougher time than the other Indexes through the second half of this year as its 7-month downhill channel is much steeper than the S&P and NASDAQ (shown in the upper chart below).

Looking at the lower chart, we see that over the past two months the Russell has repeatedly tested the lower line of the 7-year uphill blue channel and held.  Within a few weeks, however, its downhill red channel is going to either force it out of the blue channel or the Russell will use the lower blue channel line as support to break it upwards free of the red channel.

Trade well my friends


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