For a Fed day, Wednesday April 7th was pretty calm. That is, except for the Russell 2000.
For those trading the futures, that would fall under the “RTY” symbol. For those on the equity front, it’s the iShares Russell 2000 ETF (IWM).
Either way, this index was roughed up a bit on the day, with the RTY and the IWM sinking 1.6%. That’s while gold, oil, the VIX, Dow Jones, S&P 500 and Nasdaq were relatively flat on the day. Volume breadth was also a snoozer.
If you were in the IM Pro Chat room, I flagged the support level in the Russell 2000 as it was under pressure. Let’s look at that mark now.
Trading the Russell 2000
The 2,200 area provided a solid and tradable bounce soon after being tested, as the RTY initially bottomed at roughly 2,219. However, that low broke later in the day before the Russell 2000 recovered into the close.
Support is holding for now, but we need to see some follow-through. On the upside, the first level I am looking for is 2,245 to 2,250. That would put the RTY into Monday and Tuesday’s low, as well as the 21-day moving average.
Above that opens up a possible move north of 2,260 and could potentially put 2,300 in play. Plucking 80 points out of the Russell 2000 is a healthy gain in any investor’s mind — if it comes to fruition.
On the downside, a move below Wednesday’s low at 2,212 is a bearish development. A close below this mark and 2,200 could put 2,155 in play.