Russell Bear Flag Breakdown and a Good Reversal Fib
Much like the ES and NQ futures that I discussed tonight, the Russell futures may be rolling over as well. With this chart, there are two ways I see to interpret the "bear flag" formed from the March lows. As drawn now, more candles are captured by the lower channel, but to do that the flag has been violated three times, which is a little unorthodox.
The other way is to lower the lower channel to capture the three breakdowns, but in doing so, we might miss an important clue that faces us presently, so I have left it as it is.
In each of the first two breakdowns out of the flag (red arrows), the index was able to recapture the channel quickly, in a matter of a couple of days with a large green candle thrust.
The important matter I want to point out is the third breakdown (green arrow). It, too, tried to recapture the channel but ultimately failed do so and then backtested it from below and failed that too. This is why I prefer drawing this chart in this way, because it is then in alignment with the breakdowns we see in the NASDAQ and S&P 500.
And finally, this index is a bit unique in that it has a much cleaner fib retracement, having kissed the 78.6% fib before this last, and possibly final breakdown.
The other way is to lower the lower channel to capture the three breakdowns, but in doing so, we might miss an important clue that faces us presently, so I have left it as it is.
In each of the first two breakdowns out of the flag (red arrows), the index was able to recapture the channel quickly, in a matter of a couple of days with a large green candle thrust.
The important matter I want to point out is the third breakdown (green arrow). It, too, tried to recapture the channel but ultimately failed do so and then backtested it from below and failed that too. This is why I prefer drawing this chart in this way, because it is then in alignment with the breakdowns we see in the NASDAQ and S&P 500.
And finally, this index is a bit unique in that it has a much cleaner fib retracement, having kissed the 78.6% fib before this last, and possibly final breakdown.