Russell continues downhillThe Russell 2000 small-cap index having failed to maintain support at 1968, a short futures position might be worth adding to. We wouldn't start one here, though.
RTY1! trade ideas
Market Weekly Forecast: S&P, Nasdaq & Russell 2000In this video, I provide my market analysis for the upcoming week (1/16-1/19) focusing on S&P 500, Nasdaq 100, and Russell 2000 Futures. Understanding the market environment is crucial for both day traders and swing traders. I discuss how to ascertain if this week will be a consolidation week or if there's potential for range expansion. If it's a consolidation week, we can trade the market in both directions throughout the day. If it's range expansion, we should favor that direction and not fade it. For market direction, I utilize tools such as Bollinger Bands, AVWAP, a 5-day sma, and my Beacon Indicator.
The Russel is on it's Way to New HighsRecently, the Russell 2000 achieved a breakout from a sideways trading range that has been in place since March 2022.
Considering the macroeconomic environment and chart analysis, we believe that, despite today's retracement, there is no doubt that the index is on a direct path towards a new all-time high.
The two marked trade ideas provide opportunities for both conservative and aggressive profit-taking strategies.
Russel 2000 Rectangle Pattern Bullish BreakoutThe Russel 2000 has broken through a long standing Darvas Box resistance level (yellow horizontal line) on the Weekly chart.
This has formed a rectangle base in the Russel 2000 with a 23% gain price target , calculated with a 1 to 1 upward move from the top of the Darvas Box resistance level to new highs on the Russel 2000. This is not investment advice.
E-mini Russell 2000 Futures: Back to Bargain-BuyingOur View
Markets have rallied to record highs thanks to growing optimism that the US will be able to tame inflation without triggering a recession; and that the Fed will cut interest rates in 1H 2024. In a soft landing, we expect investors to start looking for bargain-buying opportunities in overlooked corners of the market including small caps.
From a valuation perspective, valuations in the small cap corner of the market are more attractive. The S&P 500 is trading at a Last 12 Mths P/E ratio of 22.7x; compared to a P/E ratio of just 18.8x for the S&P 500 Equal Weighted Index, which gives greater weight to companies with smaller market cap.
Since the end of October, the small cap focused Russell 2000 has outperformed the broader S&P 500 and the Magnificent 7, rallying by +19.42% as of 15 December. This is well above the S&P 500's 12.53% and the Magnificent 7's 14.35%.
Expressing Our View
We favour the hypothetical trade setup below in order to express our view.
Long E-Mini Russell 2000 Futures:
With a Fibonacci Retracement drawn from the November 2021 high, we favour taking a long position with entry around the present level of 2010, target level of 2280 around the 0.786 retracement level, and stop loss below the 0.382 retracement level around 1935, This setup delivers a reward: risk ratio of 3.66x.
At the same time, the 50EMA seems to be heading towards a bullish crossover with the 200EMA- a "Golden Cross" that typically signals strong bullish momentum.
• Entry Level: Present level of 2010
• Target Level: 2280
• Stop Loss Level: 1935
• Profit at Target: 2710 ticks x $5
• Loss at Stop: 740 ticks x $5
• Reward: Risk Ratio: 3.66x
Weekly chart - Testing resistanceIWM had a strong week.
It is still in what I consider a Resistance Zone.
So I'm currently looking for bearish positions and signs of weakness.
Notice that IWM has generated strong moves before that turned out to be false moves.
It will be interesting to see at which price levels we'll close the year.
December E-Mini Russell 2000 Index Futures Weekly Chart: 12/7/23Last week we saw the December E-mini Russell 2000 Index futures continues its bullish run with its third consecutive green candle closing into the Ichimoku cloud and above its 52-week moving average. With this move up, the MACD showed a bullish cross indication by crossing its signal line. RSI is trending up along with price. A continuation of this uptrend might find resistance at the top of the Ichimoku cloud (~1,906) and at the 200-week moving average (~1,930). A reversal to the downside might find support at the recent lows at the end of October (~1,640).
Please Note:
Commentary and charts reflect data at the original time of analysis (12/01/23). Market conditions are subject to change and may not reflect all market activity.
$RTY1 $IWM Big downtrend break - potential breakout underwayCAPITALCOM:RTY AMEX:IWM looks primed for a breakout. it's been lagging the other indices and with rates going lower, a lot of growth names could see some headwinds here. Market likes to get ahead of itself. From a technical perspective, it broke the downtrend from prior ATH before but failed and now it's trying again. Could be a good move out of it
RTY_F: 1800 for An Hourly Move?Looking for the Russell 2000 bulls to stay resilient at 1800 for a short term hourly move. Euro may support the move as DXY's fall through 105 is helping growth
Russell 2000 (RTY, M2K) Low-Timeframe ShortQuick idea here as we look to get back in a groove with analysis/posts after a very light October. Not going to include a lot of elaboration, but we're looking to take advantage of a swing short (price depending) via a low timeframe (5-minute) RTY supply zone (defining candles not pictured here since sub-15-minute charts cannot be posted). If price approaches the zone hot (expanded range candle vs. grinding action), look to take the trade outright upon penetration of the lower bound (1795.4). If RTY stair-steps higher, forming new pockets of demand between current price and supply, consider taking a confirmation entry (price exit from zone). Stop should be placed a bit above the zone's upper bound. Keep in mind round # psych @ 1800. Targets are 2:1 and 5:1 (look for a fall back to origin of CPI breakout). Finally, US stocks have been very bullish as of late, so shorts fly in the face of current momentum. That said, RTY has consistently been the weakest of the 4 US equity indexes, so if you're going to short one, it's probably your best bet. Have to run, but good luck!
Stay tuned b/c a LOT more ideas are coming soon!
Jon @ LionHart Trading
Russell 2000 Futures (RTY) Turning Lower After 3 Waves RallyRussell 2000 Futures (RTY) rally from 10.28.2023 low has ended in 3 waves at the 100% – 161.8% Fibonacci extension. This suggests that the rally is corrective in nature. Up from 10.28.2023 low, wave A ended at 1779.6. Pullback in wave B ended at 1687.40 with internal subdivision as a zigzag Elliott Wave structure. Down from wave A, wave ((a)) ended at 1727.10 and rally in wave ((b)) ended at 1746.8. Wave ((c)) lower ended at 1687.40 and this completed wave B in higher degree.
The Index then turned higher in wave C. Up from wave B, wave ((i)) ended at 1717.10, and dips in wave ((ii)) ended at 1694.5. Index extended higher in wave ((iii)) towards 1824.80 and pullback in wave ((iv)) ended at 1801.60. Final leg wave ((v)) ended at 1838.50 which completed wave C of (2) in higher degree. The Index has turned lower in wave (3). Down from wave (2), wave (i) ended at 1799.40 and rally in wave (ii) ended at 1813.50. Index extended lower in wave (iii) towards 1770.50. Expect wave (iv) rally to be followed with wave (v) lower to end wave ((i)). Afterwards, it should rally in wave ((ii)) to correct cycle from 11.16.2023 high in 3, 7, or 11 swing before it resumes lower again.
The Russell11.16.23 I thought I would take a look at the Russell futures because I think there is a reasonable probability trade to short the market with a small stop.... and yet this was a bullish market yesterday. I would have placed the stop very close to my trade entry. I believe the short trade is a higher probability trade but it is a lower reward trade Unless I want to sit around and wait for the market to get to the first target. If the market gets to the first target and starts to reverse and finds buyers...Then I would be Wondering if the market is going to set up to make new highs. There's more to it.... which means you have to follow the price action.
The es and the Russell11.6.23 Both the es and the Russell were good long trades.... but I would be looking for sellers despite the bullish price action of these markets. The es is more bullish than the Russell... but they're different markets in that one has been trending lower and has a 382 correction( the Russell), And the es is behaving with more strength... even though there are reasons why these markets can go lower because of all the financial information and Technical information that we hear about.
Watch for trend line breaks and bullish bounces off surportHave Conferences atleast 3 volume is key in my trading when it comes to a high place of interest like a trend line or a supply or demand zone or even a respected ema . Watch the trend of the day on more then two time frames lines . Watch for test and retest never enter on the first move . Stop loss always and set it and forget if your wrong your wrong control your risk always .. when your up then move stop to break even a very easy way to feel better about your trade and practice . The market is heading to a manager trend will it reject? Or are we heading out to the skys above .. good luck
The Russell and Es indexes on futures11.2.23 8:30 am. This video I start with the ES Which gave us a great reversal. this was a high probability trade because the market simultaneously came to a support area, an extension, And evidence of buyers. This is why you can use small stops. On the other hand when you find markets like this you do not generally want to drag your stop higher because you'll end up getting stopped out far too soon because you're not looking at this market as a swing trader. But as a scalper. This is very easy to do, But you want to work on this because this is when you really make up for a lot of losing trades if you can just stay in a good reversal trade. I spent a little bit of time on the Russell... and ran out of time to discuss the range box on a monthly chart. If you can find good range boxes on higher time frames and then you convert that chart to a daily chart and sometimes a weekly chart this is something you should start looking at if you trade the Russell.
RTY updateLooks to me like a 4 day short squeeze, indicators are not overbought yet. Fed meeting tomorrow.
Thing is, they're pumping garbage stocks right before earnings. There may be opportunity to short garbage on earnings next week.
Russell 2000 (RTY) Soon Will Open Bearish SequenceRussell 2000 (RTY) is close to breaking below 6.16.2022 low at 1640.70. A break below that level will open a bearish sequence from 11.8.2021 peak favoring further downside. Short term Elliott Wave View suggests that cycle from 8.1.2023 high is in progress as an impulse Elliott Wave structure. Down from 8.1.2023 high, wave 1 ended at 1832.8 and rally in wave 2 ended at 1934. The Index extended lower in wave 3 towards 1720.7 and rally in wave 4 ended at 1802.70. Wave 5 lower is currently in progress which should complete wave (1) in higher degree. Down from wave 4, wave ((i)) ended at 1724.30 and wave ((ii)) ended at 1792.90. The 45 minutes chart below shows the starting point of wave ((ii)) of 5.
The Index then extended lower in wave ((iii)). Down from wave ((ii)), wave (i) ended at 1772.9 and wave (ii) ended at 1779.3. The Index extended lower in wave (iii) towards 1693.80 and rally in wave (iv) ended at 1709.70. Wave (v) lower ended at 1670.90 which completed wave ((iii)). Rally in wave ((iv)) ended at 1701.82 with internal subdivision as a zigzag. Up from wave ((iii)), wave (a) ended at 1699.70 and pullback in wave (b) ended at 1675.30. Index then extended higher in wave (c) towards 1701.82 which completed wave ((iv)). Index then resumes lower in wave ((v)). While below 1701.82, expect the Index to extend a bit lower to end wave ((v)) of C of (1). Afterwards, Index should rally in wave (2) to correct cycle from 8.1.12023 high before the decline resumes.
RTY UpdateLet an open gap and got way oversold overnight, now it bounced premarket and filled the gap.
Small cap futures green, market is due for a bounce, but I don't think I'm gonna play today. I'm beginning to like cash and sleeping in, the market isn't going on an extended rally.
RTY UpdateRSI now oversold on RTY, ES, and NQ MFI is not oversold yet, and last week MFI stayed oversold and flatlined.
Risk/reward is not there for me to play a bounce, especially now that PCAR earnings pump appears to be over. If anything, I'll short next time I see the 3hr go overbought.
I don't see a market rally happening until after the Fed shutdown, gonna avoid the heartburn and stay cash.
If you're short, you're chasing an oversold condition.
Good luck.
Review of markets10.24.23 6:30 am eastern This video shows the dollar, The Russell, The ES, Tesla. Most of these markets were breaking lower and were easy shorts.... it is possible that they may find some buyers, But these markets left strong sellers that have been controlling the market for the past few weeks. In the last few weeks these markets were easy to short and much more challenging to take long positions.... even though you can do this on a 4-Hour chart without too much difficulty as long as you're careful. It's well known that most traders cannot short... they are afraid of it and they just don't do it. It's really hard to do if you own stock and you want the Hedge your long-term position... and it is expensive because shorting an equity requires payment for the privilege of you borrowing shares from your broker... really the clearing firm. it is much easier to use futures markets in my opinion. And you only need to follow a few markets, and this is a far more efficient way of spending your time. And you'll find almost everything you need on a 4-Hour chart and a daily chart. I chose tesla as a talking point because it shows the problem long-term traders have with equity markets when they were very successful in that market until the markets broke down in general. Some of the easiest ways Of making money is to buy and hold... but buy and hold traders generally don't know how to get out of a market and they don't know how to trade a market when it breaks down. When the markets went a lot lower in 2008... that really wasn't a bear market as I see it because the markets only went down about 30% and then all the corrections lower as the markets were moving higher generally only corrected to the 382... many or most traders trading today have never been in a bear market... until this market. You want to trade the volatility and factor in the gaps.
RTY EOD UpdateWell, RTY and ES RSI hit oversold.
I have no idea what this selloff is about, I'm just gonna stay cash. Might day trade tomorrow if I see something.
Really strange day, Powell didn;t say anything new, and he had a more dovish tone than last time.
RTY UpdateMarket looks like it wants to go up but RTY needs to fill the gap and TSLA is eating shit, lol.
MFI is oversold on ES and RTY, but not NQ. I think one more small down move, but I already went long on PCAR stock for earnings because it bounced off intraday support. Gonna add if it tanks this afternoon.
I think that's all I'm willing to do in this wacked up market, lol. I've made a bunch of money on PCAR stock this year, so I'm willing to risk it on that stock. It usually gets a pre-earnings pump the Friday and Monday before earnings, so you can bail out Monday afternoon if you don;t want the earnings gamble.
RTY_F: Russell forming a Bullish trend?The latest downtrend in the Russell 2000 futures contract chart has expired and a new bullish reversal signal formed here.💹
Don't miss out this low risk buy opportunity in small caps.
Big picture is still not clear given the macro backdrop, but you can trade swings tactically with low risk and high probability of success using insights from Time@Mode like the one I'm sharing here.🧠
Best of luck if you take the trade.🤝
Cheers,
Ivan Labrie.
