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In 2007, the Russell 2000 created two lower highs/Double top, and the Russell and S&P 500 soon fell hard. Turning the page forward, the Russell did the same thing again (two lower highs/Double top) and soon the Russell 2000 and S&P 500 fell in price.

The Russell 2000 is creating an unusual repeating pattern that should be respected at this time. After the initial decline in 2008, the Russell could not move above channel resistance and ended up falling hard. Turning the page forward, the Russell 2000 is now creating a rather similar pattern.

 

 

The S&P 500 followed the Russell back in 2007-2008. Should this pattern continue to repeat, the 750 level in the Russell is key for this index and the broad market.

 

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