The IWM Finds Itself in a Compromised Technical Condition

Here we are again….

The iShares Russell 2000 (IWM) is pressing below its flattening 200-day EMA, now at 111.96, on the way to another test of critical multi-month support at 110-107, which must contain the selling pressure to avert a potentially serious intermediate-term break down that projects to the 93-90 area!

My sense from my intermediate- and longer-term work is that this downleg is “the real McCoy”, and that an inability of the IWM to recover and sustain above 112.20/.50 resistance in the upcoming hours will imbue the substantial top pattern with potential to suddenly and violently break down into a waterfall-type liquidation.

I don’t know what the catalyst might be, however, the pattern itself is warning me that the IWM is vulnerable to such a scenario.

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