After a sharp decline last week, the stock market has recovered with a relentless rally this week. And this has translated into a strong Russell 2000 Index rally.
So how high could the Russell 2000 Index rally go by month end?
Well, as I mentioned in a recent post on the S&P 500 rally and targets, several stock market indices rallied off their monthly pivots, including the Russell 2000 Index. On top of that, there was a Bradley Model turning point on November 18th, with a minor one following at the end of next week. Could this mean follow through to the upside?
Since the monthly pivot MPP held (see chart below), the Russell 2000 Index rally may continue higher. And if so, it could run all the way back up to the Mr1 pivot at 1200 by the end of the month.
Either way, the lower pivot offered a nice risk-reward trade higher and we are seeing that play out. It’s probably best to trim the position into strength and trail with a rising stop.
Russell 2000 Chart – with monthly pivots
Thanks for reading and have a great weekend!
Twitter: Â @mpgtrader
The author does not have a position in any mentioned securities at the time of publication. Â Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
