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IWM Bounces off 200-day and Tests Channel Resistance

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Stocks turned a negative week into a positive week with a sharp advance on Friday. The S&P 500 ETF, Dow Industrials SPDR and Nasdaq 100 ETF recouped their early week losses and exceeded their July highs. The Russell 2000 ETF (IWM) and S&P MidCap 400 SPDR (MDY), however, recovered a portion of their early week losses and have yet to exceed their mid July highs. In other words, these two remain short of breakouts and have yet to confirm strength in the other three. For now, three of the five are in clear uptrends and the bulls have the edge. I will be watching IWM and MDY to see if they can break resistance and join the rally. Relative weakness in both is casting a shadow on this bull run. The details are on the charts below.

120804iwm
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120804mdy
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Good trading!
Arthur Hill CMT

Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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