I got all excited when Russell 2000 — as measured by $IWM — broke higher out of the 8-9 month range back in early November. To me, that felt like a big sign that stocks on the whole were about to go on a big bullish run into year-end.
Well, the sad trombone has been played and the breakout was short-lived. And as you can see from this chart, $IWM in recent weeks has completely retraced the breakout and has fallen right back into the middle of the previous range:
Man, what a letdown — for the bulls.
But us options traders over here smell an opportunity! [Read more…]