{"id":172944,"date":"2020-06-29T18:50:22","date_gmt":"2020-06-29T22:50:22","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=172944"},"modified":"2020-06-29T18:50:22","modified_gmt":"2020-06-29T22:50:22","slug":"russell-2000-gaps-present-real-targets","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/06\/russell-2000-gaps-present-real-targets\/","title":{"rendered":"Russell 2000 Gaps Present Real Targets"},"content":{"rendered":"
June 29, 2020<\/div>
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By TheTechnicalTraders<\/u><\/a>\u00a0<\/strong><\/p>\n

– Recent Gaps in price action in the IWM (Russell 2000 ETF) presents a clear picture of future price targets and support\/resistances.\u00a0 Gaps are one of the most common forms of Technical Analysis techniques.\u00a0 They represent \u201cvoids\u201d where price activity has skipped a range of price as it advances or declines aggressively.<\/p>\n

Gaps are commonly used as targets for future price activity \u2013 where price attempts to \u201cfill the gap\u201d. In Technical Analysis theory, any gap that appears should eventually be \u201cfilled\u201d by price in the future.\u00a0 Thus, any open gap that does not fill is still considered an \u201copen target range\u201d.<\/p>\n

IWM PROVIDES A UNIQUE PERSPECTIVE<\/strong><\/h3>\n

We\u2019re focusing on the Russell 2000 because we believe it provides a unique perspective on the markets related to the recent COVID-19 downside price swing and the recent recovery.\u00a0 The Mid-Cap market sector tends to trend more quickly than the US major indexes and can sometimes provide a clear picture of more true price trends.<\/p>\n

In this case, we\u2019ve highlighted the downside price Gaps in YELLOW and the upside price Gaps in BLUE.\u00a0 Two of the downside price Gaps have been filled recently as price advanced higher after March 21, 2020.\u00a0 Additionally, the two highest downside price Gaps have also been filled \u2013 leaving the lower two still open (unfilled).<\/p>\n

This presents a very easy to understand the method of identifying future price targets for both bullish and bearish price trends.\u00a0 Either price will rally to fill the upper Gap, near $163~166, or price will breakdown into a bearish trend attempting to fill the $125~130 Gap or the $108~109 Gap.<\/p>

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The recent low price level near $133.28 broke previous Fibonacci low price levels from May 29. Because of this, we believe the current trend is moderately Bearish.\u00a0 We would like to see a new lower low setup to confirm this new trend.\u00a0 When we consider the next price move in the Russell 2000 ETF, two very clear targets become evident, either the recent upper BLUE Gap range between $145~149 or the lower BLUE Gap range between $125~129.<\/p>\n

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IWM Weekly Chart<\/h3>\n

The IWM Weekly chart does not illustrate the shorter term Gap patterns as price volatility has consolidated into longer-term price bars.\u00a0 Still, we have to very clear Gaps on the Weekly IWM chart- the upper Gap, near $163~166, and the lower Gap, near $136~141.\u00a0 This lower price Gap is currently acting as a support\/resistance channel for the price as the IWM price consolidates within this range.\u00a0 A breakout\/breakdown move is very likely as the future price trend will likely exit this Gap range with an aggressive price move.<\/p>\n

The lower Gaps that are evident on the Daily chart are still valid price levels on this chart \u2013 we\u2019re just not seeing them on this Weekly chart because of the compressed interval.<\/p>\n

Before you continue, be sure to\u00a0opt-in to our free market trend signals<\/strong><\/a>\u00a0before closing this page, so you don\u2019t miss our next special report!<\/p>\n

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As we near the end of June 2020 (Q2), it is fitting that the IWM price level has stalled near this 50% Fibonacci retracement level and within the middle Gap level.\u00a0 This level will likely continue to attract price as it consolidates before entering the breakout or breakdown trend.\u00a0 Again, based on the Fibonacci price theory, the recent low suggests the current trend is Bearish.<\/p>\n

The 4th<\/sup> of July holiday weekend is nearing and prices tend to consolidate, absent any major news or earnings data, before any major holiday.\u00a0 Therefore, we may see price levels stay rather narrow this week as we await Q2 earnings and prior to the 4th<\/sup> of July holiday.\u00a0 Stay properly protected in this market.\u00a0 Any breakdown\/breakout move will likely happen very quickly in the near future.<\/p>\n

In short, I hope you glean something useful from this article. If this is the start of a double-dip, it\u2019s going to be huge, and if it\u2019s the start of a bear market, it is going to be life-changing.<\/p>\n

If you are new to trading, technical analysis, or are a long term passive investor worried about what to do, you can follow my lead. I share both my investing signals and more active swing trade signals using simple ETFs at TheTechnicalTraders.com.<\/u><\/a><\/strong><\/p>\n

Chris Vermeulen
\nChief Market Strategist
\nTheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders\u00a0 – Recent Gaps in price action in the IWM (Russell 2000 ETF) presents a clear picture of future price targets and support\/resistances.\u00a0 Gaps are one of the most common forms of Technical Analysis techniques.\u00a0 They represent \u201cvoids\u201d where price activity has skipped a range of price as it advances or declines aggressively. Gaps […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-172944","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/172944","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=172944"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/172944\/revisions"}],"predecessor-version":[{"id":172947,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/172944\/revisions\/172947"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=172944"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=172944"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=172944"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}