RTY – A Macro Corrective Bounce Has Not Topped Yet

#Russell #RTY #trading futures #trading setup

The first conclusion that we can make based on that wave count is that Russell made a lasting top in Nov’21:

It did not make a new higher high in 2023-2024 making a negative divergence with stronger siblings, Dow, S&P and Nasdaq. Because Russell 2000 represents a broader market, that tells you that the breadth did not confirm new higher highs made by Dow, S&P and Nasdaq. Normally when the market approaches a major top, it does that with less and less stocks making new highs.

So I count the move up off the low made in Oct 2023 as a corrective A-B-C up bounce of a wave (B) up. Upon completion of that A-B-C up structure we should expect a very strong drop in a wave (C) down. But that A-B-C up bounce does not look having topped yet. Therefore, I do not think RTY is ready for a breakdown.

Let’s zoom in:

Ideally I would like to get another rally in RTY pushing RTY up to the Red Box.

Let’s zoom into a 30 min micro chart:

You can see that RTY has a clean bullish micro i up, ii down setup for a rally in a wave iii up targeting 2,122.

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