Russell 2000 – Weekly Analysis

CANDLES

Two days before the March close, Russell was on track for a very bearish outcome, with a Tower Top on the monthly and a Bearish Engulfing on the quarterly. However, in the final sessions, the stance softened. The index still closed bearish, but with less intensity. This suggests a possible consolidation phase for 1–2 months before the next significant move lower, although an immediate continuation of the bearish path remains possible.

The first week of April was generally bullish, with the index narrowly avoiding an expansion of the 8/20-week EMA bearish cross by flipping it back to the bullish side. The daily and 3D frames also closed bullish, supporting the case for a short-term bounce. However, higher timeframes are not yet aligned for a sustained bullish move, suggesting any upside may be limited.

From a historical perspective, Russell appears to be repeating the bearish technical patterns of 2022, which could point to a prolonged bear market.

Overall, RUT is moderately bullish in the short to mid term, and moderately bearish—closer to neutral—on the long-term horizon.

ELLIOTT WAVES

The index continues to track the two scenarios discussed earlier.

The green path assumes that wave IV completed in 2023, with the index forming a diagonal since then—either an ending diagonal for wave V or a leading diagonal for a higher-degree impulse. The red path, alternatively, treats the structure as a large and complex wave IV that began in 2021, with waves A and B already in place and wave C now unfolding.

In both cases, there is still significant room for the current decline to extend.

At the micro level, RUT has struggled to form a clean impulse upward. The current structure leans toward a larger corrective abc wave (green), which could also evolve into a bearish flag, though this remains unconfirmed.

Summary:

Russell closed March with a softened bearish stance. While it avoided a stronger bearish setup, both the monthly and quarterly still closed negative, pointing to a likely consolidation before the next move lower. The overall structure continues to resemble the 2022 pattern, keeping longer-term risks elevated.

In the short term, the first week of April printed bullish candles on the daily and 3D frames, and the weekly narrowly flipped the 8/20 EMA back to bullish. This supports the case for a bounce, though higher timeframes are not aligned, suggesting any upside is likely limited.

Structurally, both Elliott Wave scenarios remain valid and allow for further downside. The current formation leans toward a corrective abc pattern, possibly evolving into a bearish flag, but confirmation is still needed.

Overall, Russell is moderately bullish short to mid term, but the broader setup remains moderately bearish.