Chart of the Day - Thursday, November 14, 2024

🏆 Today's Chart of the Day was shared by @CEOTechnican.
 

• On Monday, the Russell 2000 ($IWM) logged its second-highest daily close in history, settling just -0.35% below a record high. However, it's been downhill ever since, giving back half of its post-election gains. 
   
• $IWM is down -4% on a closing basis as it enters the post-election gap from last Wednesday. The fact that $IWM is testing this gap so quickly indicates a lack of conviction among buyers.
    
• To fill the gap, $IWM would need to drop -3.3%. This would coincide with a retest of the pre-election highs, which, if broken, would ruin the odds of a year-end rally.
   

The Takeaway: The Russell 2000 ($IWM) has retraced half of its post-election rally as it starts to fill last Wednesday's gap. Filling this gap would lead to a more critical test—a retest of the pre-election highs, around $224.