Stock Market Technical Analysis Blog
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Following up from last night's blog about how the QQQ and Nasdaq's outlook is improving quickly, I would like to look at the IWM - Russell 2000 Small Cap Index which has plagued the Nasdaq for the past four months and also APPL, the 800 pound gorilla in the Nasdaq.
The key words in last night's blog and tonight's is follow thru, it absolutely must happen. This will be the bears goal line stand and if they see any weakness developing at all the tide could turn really quickly.
- Chart 1: Russell 2000, looking closely we can see that it has been contained in a very tight steep and well defined downhill channel the past four months. It has tried four times to breakout and couldn't. Friday was its fifth attempt and this time it actually broke out. It's not hard to see why in that this last down wave found support at the lower line of its longterm channel. If this IWM breakout follows thru Tuesday and Wednesday then the Nasdaq should be back in business.
- Chart 2: AAPL - for the past 16 months AAPL has been banished into the red line doghouse channel but Friday afternoon it broke up thru its upper channel line into its longterm blue line mother channel. If this APPL breakout also follows thru Tuesday and Wednesday then the key components, QQQ, IWM, & AAPL will be working together to take the Nasdaq higher and the odds will be in favor of going back to the March highs.
Trade well my friends
Alan
