RUT: 5 Weeks Up, Bear Flag?

The RUT did put a string of 5 straight weeks of gains which is something it hasn't done since July of last year when it put together a six week rally that ended up being the current 52 week high before the market collapsed. That 6 week string turned out to be the mother of all bear flags as it dropped 50% from 750 down to 370 in the following 4 months.

This has been a nice relief rally and it may even continue for another week or two (I doubt it), but in the context of the weekly chart there is a strong possibility this is a bear flag just like the others that have all retraced 100%+ of those moves.

On the weekly chart it shows lower highs and lower lows. We'll keep an eye out on this rally, but so far it's another lower high which still supports the intermediate downtrend. I do respect that the current short-term uptrend, and until it breaks trend I am still short term bullish. Next weeks closing weekly bar will give us another hint as to where this chart may be headed, but notice what all the other bullish rallies set up to really be... nasty bear flags.

In a bear market, where there are lots of "white bars," there are generally some "big-ass red bars" ready to follow. (See chart for evidence)

Trade safe.

RUT Weekly Chart: