RDW Is Back at a Level That’s Worked Before

 

Well, RDW is once again testing the 13 simple moving average of lows, and this is an area I’ve been paying close attention to. I’ve been using this moving average to successfully trade the last two pullbacks in RDW, so when price comes back to this level, it immediately gets my attention. So far, this average has acted as reliable dynamic support, and now we’re seeing another test to see if it continues to hold.

Today’s high came in at 11.73, which puts 11.75 right on my radar as a potential entry level. A clean move over that price would tell me buyers are stepping back in and that this pullback may be ending. That said, I’m not locked into one specific trigger. How we open tomorrow will matter, and I’ll be watching closely to see whether the stock shows early signs of strength. If I see relative strength compared to the broader market or an uptick in volume, I’d consider an earlier entry. As always, I want the market to confirm my thesis rather than forcing a trade.

One of the more encouraging aspects of this pullback has been the volume profile. Volume has been declining as RDW pulls back, which is exactly what I want to see during a healthy consolidation. Selling pressure appears to be easing rather than accelerating. Today’s volume, in particular, was noticeably lighter than what we’ve seen in recent sessions, and that suggests sellers are becoming less aggressive at these levels.

However, there is one thing that continues to give me pause. Four days ago, RDW printed a very high-volume green candle. That kind of volume stands out, and it often marks an important reference point on the chart. The issue is that we’re currently trading below the low of that candle. When price drops below the low of a high-volume up day, it raises the bar for the next move higher. In order for RDW to push higher from here, I want to see volume really start to pick up again. Without that renewed participation, there’s a risk that any bounce could be short-lived.

For now, I’m staying patient and letting the chart do the talking. The 13 simple moving average of lows is being tested again, volume on the pullback has been constructive, and I have clear levels in mind. If RDW can reclaim momentum with expanding volume, I’ll be interested. If not, there’s no rush. I’d rather miss a trade than step in before the conditions are fully aligned.

For more analysis and market insights, visit my homepage