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Russell 2000 Daily Chart with Current Implied Volatility Band Levels for Jan. 8, 2015

01-08-15 RUT Daily Chart

As Sellers take a breather to capture gains and relieve extreme oversold conditions, RUT powered higher (fed by the release of FOMC minutes mid-session) to stall at layers of overhead resistance (formers support). These layers of resistance are critical as failure to capture this resistance will destine RUT to probe the 200 Day Moving Average waiting below.

With less than an hour before the New York open, futures are trying to penetrate resistance layers. Monitor internals and prices at our Daily Implied Volatility Band resistance levels very carefully during the first hour of trading. Failure to retain opening prices at these levels will entice Sellers back in with a retrace of Wednesday's gains expected. Once again, the reaction to tomorrow's Non-Farm Payroll report awaits and will be the final arbiter for future trend direction. Or...at least until next week when we can focus on normal intraday price swings.

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