Will Small Caps Lead Stocks Higher? – Investing.com

This article was originally published on this site


Equity markets have had a tremendous move higher off of the lows established on Christmas Eve. They have retraced almost all of the December drop and last week took a pause as they reached their 100-day SMAs. All of the major market indexes held above their 20-day SMA during the pause and all look to be headed higher Tuesday.

One, the , looks ready to take the lead now. The small-cap index looked to open above its early February high on Tuesday morning, the first to do so. Perhaps it is time for the ‘small child’ to lead them all higher.

iShares Russell 2000 ETF

The chart above shows the ETF, (NYSE:), price action over the last 9 months. The price remains below the November and December highs, when it was consolidating the initial move down, but the momentum is holding strong for more upside. The RSI is running just under overbought and the MACD is avoiding a cross down.

The Bollinger Bands® are also pointing higher. The child is not back to safety yet, though. The 200-day SMA remains overhead and it is yet to make a major higher high. Getting over the December high on this next leg would be a major plus on the road to recovery.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.