In these volatile markets the best entries are often "Failures of Buy Signals" rather then "Traditional Sell Signals" that offer the best risk/reward.
Looking at this chart as a whole, it's bearish (lower low, lower high), but the last rally back to retest June's swing lows had the bulls frothing for another leg up that just got whacked today with the close of today's candle below Tuesday's bottoming tail at the 20ma. Yesterday afternoon we saw a classic bull trap the last hour of trade.
This is the same set-up (Failure of a Buy Signal at the 20ma) that started the 200+pt romp in August.
At a minimum this is a sign of weakness, at it's best this is the start of a new move to retest the 600 area. (Notice the huge void to fill down to 600 with little help of support to the left side, price will have a hard time catching on that steep edge)
A mirror move of the Aug-Oct move would be down in the 550 area.
I'm staying bearish until a solid close above 740.
Russell 2000 Futures (TF) Daily Chart, November 17, 2011
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The following is a disclaimer to advise the reader or viewer of any charts, trade set-ups or comments from this blog by Alanpuri Trading. The information and opinions expressed here are for educational purposes only and are not intended as investment advice or an offer or solicitation for the purchase or sale of any financial instrument.
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