About That Bull Flag in Small-caps
We are looking for an upside resolution to this consolidation. These patterns are high and tight, like a military fade. A breakout above the upper end of the range this month would confirm that this is what it appears to be. We not only want to stay long, but we want to be adding to positions. I still think the Russell2000 gets above 1700, or 14% higher than current levels. That has not changed. The ETF equivalent for $IWM has been a $170 target. I see no reason to change that.
I still do not think this is the time to be conservative. I firmly believe we want to be pressing longs.
I've laid out a long list of stocks (Premium Members see Here Here and Here) to take advantage of this uptrend. I don't see anything, yet, to suggest changing our approach. To the contrary, everything we're seeing is confirming what we've already been noticing. The current action was to be expected. When something unexpected happens, then we'll reevaluate the situation and act accordingly. But that hasn't occurred. In my opinion, there is no reason to be taking the foot off the pedal.
Cheers,
JC
Advisors Corner
- The Russell2000 Small-cap Index has been on a tear since August. More recently this month it's been consolidating those gains it what looks to me like a healthy digestion that should resolve higher
- This is further evidence to the point I've been making the past few months that stocks don't just go higher, but a lot higher.
Tags: $IWM $TF_F $RUT $TNA $TZA