Up-Thrust And Test
Shorts Covered ?
Russell 2000, attempts to break through resistance; reverses and then tests (Monday), just as ZeroHedge says the short squeeze is over.
There’s a lot of trying-to-make-everything-look-complicated, wording in the link above but the take-away is, the market may be finished with the recent short squeeze.
At this juncture, Russell 2000 (IWM) looks like it’s hit long-time resistance around the 211, area and reversed.
The past two trading days may have tested that reversal.
IWM, Daily Close
The support (blue line), now turned resistance has been in-effect for over a year.
The zoomed version below shows it’s clear, at this juncture, price action’s not penetrating resistance.
As with bonds in this report, we’re at the danger point.
This is where risk is least for either short or long (not advice, not a recommendation).
Naturally, with the ZeroHedge report (above) saying that shorts have been effectively covered, price action direction favors the downside.
Charts by StockCharts
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The Danger Point®, trade mark: No. 6,505,279