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The attached figure presents the Russell 200 ETF,
IWM from the uptrend that began with the low pivot of 3/10. Note that during the
uptrend, support ( and trading opportunities) were found near the channel
midline.. The end of the uptrend may be the high of 6/5. Note that resistance is
now found at the mid channel with the high of 6/17. We can now expect support at
the bottom of the channel.
This is not good for the bulls since the DOW and
S&P have already been in down trends since 5/2. With the Russell turning
bearish, a wider portion of the market will join the sell off.
Since markets are fractal in nature, channel
analysis can be applied to any time frame to assist any type of trader in being
on the right side of the trend. When combined with other types of market
analysis, the trader can anticipate market reversals and generate reliable
trading signals.
Jim White
Pivot Research & Trading
Co.
PivotTrader.com
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