Market Outlook RUT for Nov 21st '07

Dominant TF: Daily, and 10mins (not shown).
Swings: DN-DN-DN (from DN-DN-DN)
Market direction: DOWN, but support may be found soon (in the 730s if 750 breaks).

In such high volatility environment, lower intraday time frames are doing fine. The picture is however pretty good on this snapshot too.

60mins: Down, but probable congestion on strong support level
MTFS and Entropy look bearish, with congestion potential around 750 key level. One should be careful as if 750 fails to be penetrated on the upside, RUT will fall to 734.5, then 730 (would take more than a day though)

Daily: down, possible congestion on 750 level but...
Entropy is stabilising on moderately low levels, but the bearish MTFS lines have quite negative gradients indicating RUT going lower, thus pushing support level also lower (730?). Definitely no chance of a recovery in the short term. Should 750 break, the next Fib level is around 731 (close to August lows), but this scenario is now becoming quite realistic.

Weekly: congestion to mildly down
At first sight it looks like we had the anticipated double top. However, one should not jump to conclusions just yet, as we may also remain in a broad [750-875] trading range with a lower bias (MTFS lines). The 750 level has indeed turned from pivot to strong support level. In addition, we have a PR2 Fib level around 740 and RUT has in the last 2 years always bounced back on PR2, so there is no reason it will behave differently this time.

Note: we've had a channel since mid 2003 which could break, so we should remain cautious. Breaking 731 would be however alarming.