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Russell 2000 Daily Chart with Current Implied Volatility Band Levels for Jan. 9, 2015

01-09-15 RUT Daily Chart

The rebound from Tuesday's 1153.40 low continued Thursday leaving behind a new unfilled opening gap. The recent selloff filled a gap from December 18 and is now a target for future throwback tests. As Friday morning (before the New York open) in December's Non-Farm Payroll (NFP) report, this unfilled gap could be filled very quickly. Volume has be rather light failing to validate the capture of overhead resistance layers (former support) as well. Follow thru higher is required to confirm a sustainable bullish reversal pattern.

As a NFP report release is by definition a "not normal session", usual support and resistance price zones will not be as reliable as normal. Caution is warranted with prudent investors/traders waiting on the sidelines until the reaction to the NFP report has be determined. Speculative traders may consider overextensions deep into Implied Volatility Band levels or Emptus Signals for contra-trend entries, but limited capital exposure to accommodate elevated risk is recommended. Next week will provided better (read: less risky) trade entries.

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