Good Tuesday, Traders!
Smaller stocks in the US tend to be more focused on the domestic market and the US economy.
Therefore, they tend to be less impacted by global economic and political conflicts and are typically used by fund managers to make investments on the growth and expansion of the US economy.
The primary definitive stock market index for small cap, US-centric stocks is the Russell 2000 Index (RTY).
The RTY Fundamental Setup
With plenty of global conflicts, the Russell 2000 Index is gaining attention of traders seeking a greater focus on the US with less global risk.
In addition, if you look at the compiled sales and earnings expectations of the member companies, the current earnings season is off to an excellent start with sales gains running at an average of 16.05% and earnings gains running at an average of 15.31%.
And looking out into the following quarters, the compiled estimates remain quite high for the average members of the Russell 2000 Index.
This is driving more trades into the index member stocks as well as for the RTY index itself.
That’s why the Russell 2000 futures contract is my trade idea for the week. And as we do, we’re posting this idea on our TradingView page so that the world can see our reasoning and can comment on our idea.
Below, I’m sharing the full trade idea with you that sets up the Russell 2000 Index futures contract for a nice bullish move to the upside.
The RTY Trade Setup
Here is how I see the bullish Russell 2000 Index futures contract trade setting up in my chart analysis using TradingView…
The RTY daily time frame is in an up channel.
The market hit the bottom of the channel and is showing signs of pushing bullish towards the top of the channel price point 2,127.80, about +1,311 ticks above the market from this morning.
It will be a good idea to turn to the one hour time frame and to look for low prices in the buy zone.
This trade should provide a nice profit opportunity move for a futures contract trade.
And with traders today seeking out long trades in stocks, particularly in US-focused stocks, the RTY is set up for a nice potential bullish move.
For more on the markets as well as trading education and trading ideas like this one, look for the next edition of Josh’s Daily Direction in your email inbox each and every trading day.
I’ll be bringing you more of my stock and futures contract trading tutorials as well as some additional trading ideas.
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Keep On Trading,
P.S. In addition to my trades in the futures contract markets, my pal Ross Givens here at Traders Agency continues to come up with some great under-the-radar stocks for stealth profit opportunities. And he showcases these opportunities in his premium Stealth Trades service… To learn more about how to become a stealth stock trader following Ross’s lead, click here now.
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