RDW Defends the 13 EMA as the Trend Is Tested

 Above is a daily chart of RDW with a 13-day exponential moving average of the lows, and over the past four months this average has done an excellent job of acting as both support and resistance. It’s one of those levels that just keeps showing up on the chart, and when that happens, I pay attention. You can clearly see how many times this moving average has essentially nailed both the highs and the lows during that period, and today was no exception.

Early in the session, RDW pulled back and tagged this 13 EMA of the lows almost perfectly. That level once again acted as support, and price responded the way you’d want to see if you’re leaning bullish. Buyers stepped in, defended the level, and RDW managed to close back above $10 by the end of the day. From a technical perspective, that’s a constructive outcome and reinforces the importance of this moving average.

For me, this 13 EMA of the lows is now my clear line in the sand for the short-term uptrend that began in early December. As long as price continues to hold above this average, I’m willing to give the benefit of the doubt to the bulls. It defines risk very clearly and keeps me from overthinking every little pullback. A decisive close below this level, however, would change the character of the chart and would make me much more cautious in the near term.

That said, it wasn’t a perfect day. I did notice some subtle signs of relative weakness versus the broader market. Around 3:00 ET, when the SPY pushed to a new high, RDW failed to confirm with a new high of its own. That kind of non-confirmation is worth noting, especially in a stock that’s been driven heavily by momentum and sentiment.

Still, as long as RDW continues to respect this 13 EMA of the lows, I’m going to stay bullish and stick with the trend. The chart is telling me where I’m right and where I’m wrong, and for now, that key average remains firmly intact.

I recently highlighted this same 13 EMA in my post “RDW Approaches Resistance as I Wait for a Better Entry,” and it continues to prove its usefulness.