IWM Chart – Close to Key Support Level

I charted the year to date daily prices of the Russell 2000 ETF, IWM, late this morning when it was trading at $59.36.  It’s getting close to a key support level and is worth watching here.  Yesterday IWM broke below its shorter trend line of higher lows and is only a few cents away from the longer trend line that hasn’t been tested since it was last touched in July. 

Before trying to get in front of the trade, it might be a wiser move to wait for Williams %R to give the buy signal first.  In green I highlighted this year’s moves above oversold for the 14 and 28 day indicators.  Notice how they foreshadow a good run for IWM in each case.  On a couple of them the run only lasts for a short period of time, but on others the bull run lasts much longer.  In either case, getting in before Williams %R gives that signal is a set up for more losses.  IWM is now set up to move higher, but it’s probably wiser to miss the first day or two of the rally to save the chance of missing further declines.