RUT: Late Comer to the Bear Party

The fact that the RUT had a bulltard run up to 764 didn't surprise me because I saw the same bullish non-sense in December and knew it's days we're numbered. Yes, the market can do anything it wants, but one also has to factor in the common sense of what $4 gas is going to mean to the bottomline of domestic small cap companies looking forward.

In summary, this move up to 750 was expected and resistance at 750 was also expected. The move down also expected. I mention this because it's following basic technical analysis (support and resistance) and these levels allow us to plan our trades accordingly. I like the RUT because it generally plays by technical rules pretty well most of the time.

What's next? If it can hold 720 on Thursday maybe it can stop the bleeding for a few days. If it heads lower on Thursday the support I'm looking at is the 100MA 708.22 and the 50% fib level at $702.81

IF the RUT gets down to $702.81 tomorrow that means that the bears took down 7 weeks of upward price action (April 16th to June 5th) in 5 days -- Wow, that's efficiency!


RUT Daily Chart: