The Russell 2000 (RUT) is in a strong position in the long term. Price is well above the 1:1 Gann angle from the lower left of the square. More impressively, price is above the 1:1 descending Gann angle. Price put in a double bottom ending at the 25% time cycle.
Price broke down from the top and was stopped by the 1:2 angle which is 1/2 the slope of the move up. The correction currently has a smaller slope down that the move up. As long at price remains above the 1:2 angle, the RUT is in great position and signaling that October 10th will be a long term low. Price has not retraced 50% of the 2002-2007 move (actually near a 3/8 retrace).
The smaller growth companies cannot function in a recession or a weak credit environment. They do not have the resources to sustain a downturn without large damage to earnings and stock price. Unless this chart moves below the August low I am long term bullish.
Tags: Double Bottom · Gann Angle Fan · Growth Stocks · Russell 2000 Smallcaps · SlopeNo Comments
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