Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious Outperformance
Find Stocks Now

Are Small Cap Investors Getting Greedy at Important Resistance?

Published 04/01/2024, 06:01 am

Small-caps stocks have been a noticeable laggard for over two years.

But a recent year-end rally has set the iShares Russell 2000 ETF on fire. Will this mark a change in performance in the future?

IWF-Monthly Chart

Today’s chart of the Russell 2000 ETF highlights its underperformance (see blue shaded area where IWM has traded sideways for two years). The blue shaded area also represents the lower 50% of the high to low).

Note that the recent sharp rally has the Russell 2000 testing the 50% retracement line at (1) and this is occurring as SentimenTrader trading sentiment reaches Extreme Greed. Just as Extreme Fear has marked bottoms in the past, Extreme Greed may be marking a top here.

In my humble opinion, what this 2-year market laggard does at (1) may just be important.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.