Russell 2000 Technical Analysis – The bulls will need to defend this key support

<p>The tensions in the Middle East have risen on late
Tuesday as a rocket <a href="https://www.bloomberg.com/news/articles/2023-10-17/gaza-officials-say-hundreds-killed-at-hospital-in-israeli-strike">hit a hospital in Gaza</a> killing
hundreds of people and sparking a global outrage. As a consequence, <a href="https://www.forexlive.com/news/jordan-has-cancelled-the-summit-meeting-in-amman-with-biden-egypt-and-palestinian-leaders-20231017/">Jordan cancelled the summit</a> that was
scheduled between the US President Biden, the Palestinian President Abbas and
the Egyptian President al-Sisi in Amman. </p><p>On a domestic side, the strong <a href="https://www.forexlive.com/news/us-september-retail-sales-07-versus-03-expected-20231017/">US Retail Sales</a> data was
followed by a rally in Treasury yields with the 10yr approaching 5.00%. This
tightening in financial conditions might be weighing on the stock market,
especially in this part of the cycle when the past rate hikes should start to
feed through the economy faster.</p><p>Russell 2000 Technical
Analysis – Daily Timeframe</p><p>On the daily chart, we can see that the Russell
2000 bounced on the key <a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/">support</a> around
the 1720 level but got rejected from the red 21 <a href="https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/">moving average</a> again
and erased almost all the gains soon after. The buyers are likely to step in
with a defined risk below the support once again to position for a rally into
the resistance around the 1820 level where we can find the <a href="https://www.forexlive.com/Education/technical-analysis-confluence-20220318/">confluence</a> with the
<a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/">trendline</a> and the
50% <a href="https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/">Fibonacci retracement</a> level. </p><p>Russell 2000 Technical
Analysis – 4 hour Timeframe</p><p>On the 4 hour chart, we can see that the price has
been printing lower highs into the 1720 support in what looks like a <a href="https://www.forexlive.com/Education/chart-patterns-guide-20220125/">descending triangle</a>. This
might be a sign that the sellers are stronger, and we could see a break to the
downside soon. Generally, the price can break on either side of the pattern and
what follows is usually a strong and sustained move in the direction of the
breakout, so this will be something to watch out for. </p><p>Russell 2000 Technical
Analysis – 1 hour Timeframe</p><p>On the 1 hour chart, we can see more
closely the pattern and the key levels with the 1720 support zone and the
trendline defining the triangle. In such instances, is best not to trade within
the triangle as the price action can be messy and erratic leading to false
signals. </p><p>Upcoming
Events</p><p><a href="https://www.forexlive.com/EconomicCalendar">Today</a> we will get the latest US Jobless Claims data
and it will be interesting to see if the miss in Continuing Claims last week
was just a blip or the start of a trend. Later in the day we will also hear
from Fed Chair Powell where the market will be focused on any hint about the
near-term policy outlook. </p>

This article was written by FL Contributors at www.forexlive.com.