The small caps are still at the heart of whether this market is not he cusp of another sharp rally to fresh higher, or instead not he precipice of something more ominous than what we have seen in quite some time. To be sure, bulls are aware of this and will be guarding, or at least trying to guard, the Russell vehemently into further weakness like we saw this morning.
On the 30-minute chart of the small cap ETF, note the bounce this morning off the lower Bollinger Band punch and reversal higher. I would not be surprised if we inched up to that orange line. But that is when the true test come in as to whether strength in the Russell keeps getting sold.
I have a few shorts on inside 12631, but have my eye on the exits if this bounce builds steam into the afternoon.
On the long side, a name like SFLY has my interest into further strength.
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Trying to stay strong in my shorts. Today’s bounce hurts, but pull $IWM back to the 60 min chart and it helps to keep perspective. Short $amzn, $lnkd, $yhoo, $pcln
It is always my please to read posts from Chess.