The US stock market is having plenty of challenges. Leading indexes have moved into bearish market conditions, with perhaps more to follow.
And even if we get the recovery in some of the leading indexes, not all are set for a recovery right now before a potential further selloff.
Small stocks as tracked by the Russell 2000 Index and traded via the futures contract (RTY) are one of the trade ideas that may shape up for a quick potential profit on the sell side.
So, let’s take a look at potentially capitalizing on a selloff in the Russell 2000 futures contract (RTY) for a gain this week…
The Russell 2000 Index (RTY) Trade Setup
Here’s how the chart is showing the potential gain from selling the small stock-focused Russell 2000 Index futures contract (RTY) in a bear trade setup…
And here’s how I see the potential bear trade setting up…
The Russell 2000 stock index futures contract (RTY) daily time frame is in a down channel.
The market is moving from the top of the channel towards the bottom of the channel price point at 1,635.00, about +977 ticks below the market.
This represents a profit opportunity for a bear or sell trade in the RTY contract.
It will be a good idea to turn to the one hour time frame and to look for high prices in the sell zone.
The Bottom Line
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