IWM Wedge Target Hit, SPY Backfills Gap, QQQ Divergent High

IWM has now hit the 148.37 falling wedge breakout target hit with an afternoon fade of today's rally likely to bring it back to the 147.43 level soon. (scenario shown on last chart). All charts below are 60-minute time frames.

In tandem with IWM hitting resistance, SPY has now backfilled the Nov 8th/9th gap, a resistance level likely to cap today's rally in the large caps as well. While QQQ doesn't have any overhead resistance as it is trading at a new high, this most recent high on QQQ is an extension of the negative divergences that have been building since the previous divergent high on Nov 8th. Breakouts to new highs with negative divergence in place have an increased rate of failing.

2017-11-16T13:29:25+00:00Nov 16, 2017 1:29pm|Categories: Equity Market Analysis|Tags: , , , , , |2 Comments


  1. GetItRiight November 16, 2017 2:15 pm at 2:15 pm

    There’s no fading in this market. Honestly, I don’t know why the newfound enthusiasm compared to last few days. Politically, it’s the same situation, the tax bill needs to be passed in the Senate, not the House, which is not at all assured, relief rally I might understand but this big and continuous buying? Oh well, if you can’t beat them, join them. Best looking opportunity for me is XBI with the positive divergence on the 4hr and slowly on the daily. I missed getting into the semis, which are just a perpetual money maker.

  2. rsotc November 16, 2017 3:05 pm at 3:05 pm

    I had earlier stated 147.43 as the pullback target for today following the tag of the 148.37 target earlier. Upon closer inspection via this 1-minute chart, 147.57 appears to be the first & only decent support level & most likely target. While a reaction if/when IWM gets there is likely, any impulsive & solid break below this level could send IWM even lower. Key Fibonacci retracements of today’s rally (potential pullback targets), should 147.57 give way, would be 147.27, 146.92 & 146.57* (*those Fib retracement levels assume that today’s high of 148.40 is not taken out first).


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