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Chart Chatter: $RUT

Welcome to Chart Chatter where we discuss various technical charts we find of interest. We cover indices, signals and stocks on different timeframes highlighting different technical techniques we use over time. We’ll focus on key observations we find relevant which readers may find of use for their own trading.

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A couple of weeks ago we mentioned this in regards to $RUT: “recent highs have seen a divergence in volatility compression. No new lows on the volatility index were achieved, which could suggest a change in character. Also $RUT failed to tag the upper trend line when making the most recent highs. This could be suggestive of waning strength“.

We showed this chart:

Since then $RUT has indeed weakened considerably and $RUT has broken its wedge to the downside:

We can also observe that $RUT’s underlying volatility index as broken to the upside.

On the 2 hour chart we can note the most oversold readings since February:

There is support here in this vicinity including the .236 fib level which currently is being tested:

$RUT is also trading outside of its daily Bollinger band for the 2nd day in a row, hence this could be a bounce zone.

On a further breakdown there is very strong support confluence at the .382 fib near 1620/1621.


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