The Nasdaq 100 Index (NDX) has been basing with a narrow range for a couple weeks. This chart has the potential to take off bullishly as price and time hit the 50/50 point and are consolidating. The setup is also there for price to break down from here.
The Russell 2000 (RUT) made a nice move off the low but has created an inverse cup-with-handle formation. A break to a new low here would be very bearish and would be setup for significant downside. The handle has formed at 50% time which worries me. The only positive in this chart is that the handle’s volume is high on the way up and lower on the recent move down. I won’t feel comfortable here until the 1:1 Gann angle (red diagonal) is taken out by price.
Charts courtesy of Stockcharts.com
Post Modified: July 31st, 2008 at 11:54 pm
Tags: Cup with Handle · Gann Angle Fan · Narrow Range · Nasdaq Charts · Russell 2000 Smallcaps · VolumeNo Comments
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