Monday, September 28, 2009

IWM failed breakout

IWM recently broke out of a perfectly formed rising wedge then reversed after the fed interest rate announcement last week. After re-entering the channel I think its pretty safe to expect a test of the lower end soon near $56. There also seems to be price support just below there near $55 and thats my equivalent "line in the sand" for the small caps. Like SPX 950, IWM holding above $55 looks like a cyclical bull market whearas a break below that level looks to me like a resumption of the bear market ( since we'd have a series of lower lows in place). For now, the benefit of the doubt lies with the bulls and the odds go with long trades. Good luck this week.

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