Shares of the Russell 2000 ETF (IWM are bouncing for the second day in a row. The big question is, what is the bounce target? To answer this we turn to technical analysis. This epic collapse in the Russell 2000 started at $169 on February 20th, 2020. By March 19th, 2020 it tagged $95.50. This was an huge collapse of 43.50% in one month. A drop of this magnitude, this quickly is almost unheard of. In any case, the collapse percentage does give us some great information technically. When we do our Fibonacci retrace lines, we find that a 38.2% retrace is near $124.00 (current price is $111.00). In addition there is a major gap fill $126.00. When two major technical levels are so close together, it gives investors a good idea that will be an ideal target near-term.
To summarize, the Russell 2000 ETF (IWM) will likely bounce to $124-$126 in the coming weeks before stalling and possibly turned back down.
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