RUT Russell 2000 Small Caps Weekly Chart Bull Flag Rising Wedge Overbot Negative Divergence

Traders are chasing into small cap growth stocks believing in the U.S. growth story as the rest of the world falters. The RUT is printing new all-time highs now well above 1K at 1018. The bull flag from the April low targets 1020-1040. Price continues to move upwards inside a rising wedge (bearish pattern) approaching the apex. The red lines show the negative divergence spank down from the May top at the top trend line. The blue lines show another higher high in price due to the three week rally with negatively diverged indicators again. The daily chart, however, has momo so a further upside move in price would be expected even if a pull back for a day or two occurs, but RUT continues to exhibit topping behavior.

The ADX line is leaking lower since March showing that the upside was a strong trend through March but not so much afterwards. The brown dots show the moving average ribbon extension with price above the 20 MA above the 50 above the 200 consistent where price reaches a ceiling.  Projection is for RUT to top out in here at 1018-1040 over the coming days or couple weeks and move to the downside again. Price collapses out of rising wedges can be quite dramatic. Note that if the rising wedge is stretched out to completion this places the index at Labor Day so the bulls can stretch the elevated prices out for several weeks if the central bankers keep pumping the easy money talk. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.