IYT posted a new YTD low at 70.82 (04 Oct), just short of the 69.94 key support of the 2010 low (6 Jul 2010), ahead of the powerful recovery through the 84.93 lower high. Further strength would allow bulls to challenge the major 2-month range resistance at 86.22 at 50% retracement of the 101.60/70.82 decline, where a potential swing high is anticipated. A reversal to the downside would re-open 79.06 (Support 1) then 75.36 (Support 2) where bulls may reassert.
However, clearance above 86.22 (Resistance 1) would negate and confirm the 2-month base in place above the higher reaction low at 70.82. Bulls would initiate the next upleg towards 92.02 (Resistance 2) then 94.64 (Resistance 3).
Trading Indication:
Short-term: Sell at 85.50 or higher;
Target at 79.06 and lower;
Stop Loss at 86.50 (1.20%)
Long-term: Possibly buy lower
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