In our last update on RUT [see: Nov 11 Update] we noted that RUT was likely to break through to new highs.

…given that it’s Friday, and RUT is now only 14 points short of new all-time highs — we have another good argument for a gap to new highs on Monday.

RUT did, in fact, gap up to new highs on the following Monday, and has since gained another 6.3% in less than a month.  Can it maintain its momentum, or has it moved too far, too fast?

continued for members…

If it follows the same general pattern as SPX (as guided by our analog), it’s getting fairly close to its next turning point at 1392.  Note that 1391.99 is the 1.272 Fib.  The biggest reversal on its way here was at the .707 Fib, so it doesn’t owe us a reversal at the 1.272.  But, given that it intersects with the gray/yellow channel top right around the end of the year, I think it’s a reasonable target.

Breaking out of the rising white channel was a very big deal.  But, RUT has had trouble, before, holding important support.  So, we’ll keep an eye on the channel top — now about 1327, as a potential backtest target if/when RUT stops to catch its breath.

GLTA.