On the daily chart below, we can see that the market is still stuck in the range between the 1723 support and the 50% Fibonacci retracement level as resistance at 1820. We’ve been in this environment since the collapse of the Silicon Valley Bank, and amid the crisis in the regional banking sector, which the Russell 2000 is more exposed to, the index underperformed the other major indices. The recent economic data wasn’t that much supportive either as we keep getting conflicting signals that point to either a recession coming soon, or the Fed being forced to keep hiking or staying higher for longer.
Russell 2000 Technical Analysis
On the 4 hour chart below, we can see that there’s not much to glean from this chart. There’s no clear level or direction. The best strategy in such markets is to just sit out and preserve the capital for better times. Alternatively, one can also “play the range” buying at support and selling at resistance.
On the 1 hour chart, we can see that the last Friday’s selloff is being erased today as the market isn’t yet certain on the direction and the sellers lack conviction for a break lower. We have two levels here that traders will be looking at. One is the high at 1762 and the other is the low at 1734. If the buyers manage to break above the high, we should see the rally extending towards the 1787 level. On the other hand, if the sellers manage to break below the 1734 level, a breakout of the 1723 support will be targeted.
