Will Small Caps Follow the S&P Higher?
The Russell 2000 small cap index has lagged all year, but it may be showing some signs of coming to life.
The first pattern on today’s chart is the rally in early June, a potential sign of the bulls taking charge.
RUT proceeded to retrace half the move before rebounding. That could mean the bulls are staying in charge.
Third, the bounce occurred around 1820. That price area (marked in white) served as support and resistance a few different times this year.
Next, 100-day simple moving average (SMA) crossed above the 200-day SMA in mid-May. The 50-day simple moving average (SMA) is also nearing a potential “golden cross” above the 200-day SMA.
Those patterns not only suggest long-term trends are growing more favorable. They also resemble similar developments in the Nasdaq-100 and S&P 500 before those indexes rallied to new 52-week highs.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
The first pattern on today’s chart is the rally in early June, a potential sign of the bulls taking charge.
RUT proceeded to retrace half the move before rebounding. That could mean the bulls are staying in charge.
Third, the bounce occurred around 1820. That price area (marked in white) served as support and resistance a few different times this year.
Next, 100-day simple moving average (SMA) crossed above the 200-day SMA in mid-May. The 50-day simple moving average (SMA) is also nearing a potential “golden cross” above the 200-day SMA.
Those patterns not only suggest long-term trends are growing more favorable. They also resemble similar developments in the Nasdaq-100 and S&P 500 before those indexes rallied to new 52-week highs.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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