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Beware 1200 On The Russell - Breadth Breakdown Is Big Risk To Small Caps, BofA Warns
The US equity market struggled last week but the S&P 500 held the rising 200-day MA once again, but as BofAML notes, the much broader-based NYSE stalled at 200-day MA resistance last week. The NYSE has a potential head and shoulders top as well as a breakdown for the NYSE stocks only advance-decline line through the March low. Similar to the NYSE Comp, the Russell 2000 also shows a potential head and shoulders top with a breadth breakdown a big risk to 1200 support...
Via BofAML,
NYSE: 200dma holds as resistance; Big support = 10,600 Unlike the S&P 500, which held its 200-day MA as support last week, the NYSE stalled at 200-day MA resistance last week. The NYSE has a potential head and shoulders top as well as a breakdown for the NYSE stocks only advance-decline line through the March low. This breakdown for breadth is a potential leading indicator for a breakdown in the index below its early July and March lows at 10,659-10,622 toward 10,060-9886 (projection and October 2014 low). It would take a move above 11,032-11,170 to improve the pattern.
Russell 2000: A-D breakdown is risk to big 1200 support
Similar to the NYSE Comp, the Russell 2000 also shows a potential head and shoulders top. After holding its 200-day MA in late July, the Russell 2000 broke and closed below this important longer-term moving average on Thursday and Friday. This coincides with a fresh break to new lows on the small cap advance-decline line and places big Russell 2000 support at 1212-1206 or 1200 at risk. Below this support would confirm a top and suggest deeper risk to 1154-1134 (early 2015/late 2014 chart support) and then 11151110. First resistance comes in at 1245-1255 but the potential head and shoulders top is intact while below 1268-1278.
Another bearish sign for market breadth. The S&P 500 has held its 200day MA as support while the more broad-based NYSE Comp has met resistance at is 200-day MA in recent sessions. The small cap Russell 2000 has broken below its 200-day MA after holding it as support in late July.
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Small and mid-caps have been having problems for awhile, but everybody focuses on the big, shiny corporations. Just floating on a river of shit.....
Pointed out that head and shoulders weeks ago..BofA boys are slow on the draw...must be running out of blow and ludes.
...and now that they've pointed it out - would you actually dare to take it?
Feels so like 1987. Enjoy your Tuesday.
There have been many times over the past 7 years when technicals appear to be breaking down. Algo's and central bankers don't give a shit whether its a simple or exponential moving average, or anything else, and as long as they call the shots these financial crime scenes will keep plodding higher. Its all about killing the shorts and they have that one down pat.
obviously mercinaries aren't equiped to support the fed's fears, yet
If we can get the S&P back down to 666 we'll be closer to reality.
A FED rate raise of 2% would help.
the fed is s t r e t c h e d
heard it already :yawn: these so called markets are b-o-r-i-n-g
PCRIX (PIMCO commodity real return ) went up 99% today after being beated down for 4 years. WHY?
Can I use technical analysis to predict the NCAA playoffs? Of course not.
So what makes you think you can use it when you don't have a market? TA is going to be wrong, over and over again, until it reverts to a real market. Then, thousands of gurus who have been wrong for seven years will say "See, I told you so."
It's the Ides of March you need to beware of, not 1200 on the Russell.