It seems like every market pundit and their mother has watched the small caps as they've budged over the highs of the year. Not surprisingly, small caps are probably the most popular bullish new years pick out there. Could the crowd be wrong? Let's take a look.
Relative strength is in a horizontal resistance zone, but it appears more out-performance of larger cap indices is continuing. At the same time, we see the small caps ETF IWM reversing at the boundary line connecting the two prior peaks.
Who knows if the boundary will hold or if this is just a speed bump, The question here is how much of a pullback it would take for cynicism to go through the roof. A push lower into the newly rising moving averages might just do the trick.
Trade 'em well!
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