US Stock Indices Daily Recap: That Wasn't Much of a Down Day… – FX Empire

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Since the close on January 29, the Russell has done just about the same again and gained 11.10%. It’s outperformed all the other major indices by a minimum of 5% in that period.

Not to mention, year-to-date, it’s already up a staggering 18%.

Small-caps are funny. They either outperform and underperform and can be swayed easily by the news. I foresaw the pullback two weeks ago coming for over a month, and unfortunately, I see the same thing happening now. But only for the short-term.

I remain bullish due to aggressive stimulus, which could be put in motion this week.

I also love small-cap stocks for the long-term, especially as the world reopens and this Biden agenda gets put in motion. It seems like things are finally trending in the right direction.

For now, though, the index is once again overbought.

The RSI is at a scorching 75, and I can’t justify calling this a BUY or HOLD right now. It’s an excellent time to take profits.

SELL and take profits. If and when there is a deeper pullback, BUY for the long-term recovery.

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Matthew Levy, CFA
Stock Trading Strategist
Sunshine Profits: Effective Investment through Diligence & Care

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