(MENAFN- Daily Forex)
Unfortunately, a lot of retail traders do not pay attention to the Russell 2000. This is an index that is made up of smaller companies in the United States, and it's a good representation of what the economy may or may not be doing. We had a very rough session on Wednesday, but what I find interesting is that we are right at an area where there should be plenty of market memory attached to it. This is an area that previously had been resistance, but it should now be support.
That being said, the market has already found buyers jumping back into the market at the bottom of the candlestick for the day and could very well end up being a short-term buying opportunity , but if we were to break above the 2200 level, it's likely that the NASDAQ in 2000 will continue to go even higher, and perhaps even pick up a bit of momentum . Regardless, while most traders are playing around in the NASDAQ 100 based on a handful of stocks, the Russell 2000 level should continue to be more or less growing higher as long as there are people talking about the Federal Reserve cutting rates.
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Ultimately, this is a market that I think continues to be a“buy on the dips” market, and I think we may see that playing out during the session here on Wednesday. However, the next couple of days could very well be very noisy due to the fact that the jobs number comes out on Friday, that of course will cause quite a bit of volatility . In general, this is a situation where I think you have a lot of indecision, but given enough time, this is a market that I think goes looking toward the recent highs near the 2450 level.
If we were to break down below the 1950 level, that could send the market back down to the 1777 level, perhaps even as low as 1700. I don't necessarily expect that, but it is worth noting that we have quite a bit of volatility. In general, this is a market that looks like it is trying to break out of a basing pattern, perhaps playing a little bit of catch-up to the insane moves we have seen other indices in the United States do.
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