It happened. Finally.
At the close yesterday small caps had finally made the turn. The long awaited momentum signal was triggered. The odds that the market has seen its lows for the short to medium term grew substantially yesterday.
I've been writing about it the last few weeks. While $SPY $QQQ and $DIA all gave false hope last week, $IWM has remained steadfast. Small caps were the first to start correcting. And now they are the last to start to recover.
Remember it was small caps that led the market higher late in 2016 after the market was down 9 days in a row. It was just before the election...
Next week is election week. Go figure.
After yesterdays 2.5% rally, we could see some sideways action today, however I think the set-up is a move back to $160+ for $IWM in the short to medium term.
Just like small caps led the recent market correction, a small cap rally could help pull the indices out of their recent doldrums.
The opening bell is coming. See you in the chat room.