Like it or not, the small cap index, Russell 2000 is breaking out in a big way.
We’ve been moving sideways since late 2016 and just this week we saw a gap and go sharp move to all-time highs and are in the process of resolving this 20-week range to the upside.
For all the bear attacks incoming, yes this move can fail, yes we’re overbought and yes, we do have plenty of headline risk over the near term with earnings, fiscal policies, government budget shutdown issues, etc. that could de-rail this move.
Trading is difficult.
Anyone who tells you otherwise probably hasn’t traded long enough, or is trying to sell you something.
I certainly don’t have all the answers, but I have learned a lot over the years and, throughout this post, I’m going to share with you some high-level trading tips, tricks, and painfully learned lessons I’ve picked up along the way.
Leveraged ETFs get some very divided opinions in the investor and trading community.
On one end of the spectrum, they get tremendous love from adrenaline-chasers looking to bet it all for a quick double on their account in short time.
And on the other, there is a great deal of hesitation backed by an army of articles written with the warnings
While price action remains near-term choppy and ranged bound, one market breadth indicator, the cumulative advance-decline line, continues quietly trending to all time highs.
Here’s a look at the S&P500 $SPY ETF over this same time period.
If you trade stocks and you don’t follow market internals, also known as market breadth, then you’re missing out on a lot of valuable information.
Like any other study or indicator, market internals aren’t guaranteed to get it right all of the time, but when they do begin to diverge or exhibit some
After falling more than 11% in the first 3 weeks of March, crude oil finds itself re-testing a rising multi-month trendline extending back 12 months to April of 2016.
Short term momentum remains lower in the black liquid, and therefore caution is advised, but be aware longer term dip buyers could start picking away around this 47 area.
The small cap index, Russell 2000 $IWM just closed out a 5 point -2.74% range daily candle that cleanly engulfed about 50 days worth of trading.
I’m old enough to remember when moves like this would occur over multiple sessions.
I’l let this chart speak for itself.
After 14 weeks of moving sideways, the small cap index, Russell 2000 $IWM is back re-testing the December 2016 multi-month highs.
We briefly broke above this 138 area in late February, but ultimately couldn’t maintain higher prices for very long and traded back down towards the middle of the range.
All eyes are on the Fed tomorrow which has the potential to be a market moving catalyst. I have no helpful insights into what remarks to look for from the release, but I can outline the current stock market technicals to help you create a plan for the reaction.
- The $SPY ETF is trading around its largest pullback YTD which is a laughable 3 SPY points off highs.
- The VIX is off YTD lows, trading north of 12 and was up about 10% on the day earlier in the session.