Russell 2000 Technical Analysis – Key support got breached

<p>Last week the <a href="https://www.forexlive.com/centralbank/the-fomc-keeps-the-target-fed-funds-range-at-525-to-550-20230920/">Fed kept interest rates unchanged</a> as
expected while striking a hawkish tone via the Dot Plot. In fact, the Fed not
only sees another rate hike by the end of the year, but also much less rate
cuts by the end of 2024. <a href="https://www.forexlive.com/centralbank/highlights-from-the-fed-chair-powells-press-conference-after-september-rate-decision-20230920/">Fed Chair Powell</a> has also
admitted that the soft-landing scenario is not his base case at the moment and
stronger than expected economic data may require additional tightening. For
now, the economic data remains strong with <a href="https://www.forexlive.com/news/us-initial-jobless-claims-201k-versus-225k-estimate-20230921/">Jobless Claims</a> crushing
expectations last week, which is not what the Fed wants to see.</p><p>Russell 2000 Technical
Analysis – Daily Timeframe</p><p>On the daily chart, we can see that the Russell
2000 eventually broke out of the key <a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/">support</a> zone
following the FOMC meeting and it’s now eyeing the 1720 support. At the moment,
the price is a bit overstretched as depicted by the distance from the blue 8 <a href="https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/">moving average</a>. In such
instances, we can generally see a pullback or some consolidation before another
impulse. </p><p>Russell 2000 Technical
Analysis – 4 hour Timeframe</p><p>On the 4 hour chart, we can see that we might have
a classic “break and retest” pattern around the broken <a href="https://www.forexlive.com/Education/technical-analysis-polarity-20220408/">support turned resistance</a> where
there’s also 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>, the red
21 moving average and the daily blue 8 moving average. That’s where we can
expect the sellers to pile in with a defined risk above the trendline to
position for a fall into the 1720 support. </p><p>Russell 2000 Technical
Analysis – 1 hour Timeframe</p><p>On the 1 hour chart, we can see more
closely the bearish setup with the <a href="https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/">Fibonacci
retracement</a> levels for further confluence. A break
above the trendline will invalidate the bearish setup and the buyers will
likely take the price into the next major trendline around the 1860 level. </p><p>Upcoming
Events</p><p><a href="https://www.forexlive.com/EconomicCalendar">This week</a> is pretty bare on the data front with just a
couple of notable economic releases. Tomorrow, we will get the latest US
Consumer Confidence report while on Thursday we will see again the US Jobless
Claims data. On Friday, we conclude the week with the US PCE data.</p>

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