Did You Capitalize On IWM's Outperformance This Week?
by Mike Paulenoff
July 18, 2020 • 12:00 AM EDT
In his Trading Room a week ago Friday, Mike Paulenoff mused about whether traders would start to bid up the lagging IWM (Russell 2000 Small Cap ETF) like they were doing Big Tech.
He wrote, "It seems to me that as long as support between 137 and 132.30 contains any forthcoming weakness, just maybe it is positioning itself for a run? In the event ES takes out 3174-3184 into the closing bell -- won't 'they' be coming for the Small Caps too?"
At the time, IWM was trading at 141.30, but went on to rally this week (after dipping but holding above MIke's designated key support zone). It closed the week at 146.59, up 3.7% from his prior Friday post.
Where is IWM headed next, and how will it perform relative to the SPY and QQQ?
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Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts on
ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international
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More Top Calls From Mike
On Friday June 17, Mike Paulenoff posted an alert to MPTrader members about an emerging setup in AMZN:
AMZN is one name that pops out at me that should benefit from an initial and sustained correction in traditional energy and transportation costs. AMZN needs to climb above and sustain 110 for my work to generate a more confident technical signal, otherwise, I cannot rule out another loop down that tests and breaks key May-June support at 101.26 to 101.
Last Wednesday, prior to the official FOMC rate hike of 75 bps, Mike Paulenoffwarned MPTrader members about the likelihood of additional weakness in the beleaguered home builders, writing about the ITB (iShares US Home Construction ETF):
In that, neither my pattern work nor my intermediate-term Momentum gauges offer much technical confidence that ITB will be able to carve out a meaningful corrective basing area in and around 53.
Back on May 13, amid a thrust in the price of Crude Oil from $95/bbl to $112/bbl, Mike Paulenoff alerted MPTrader members to an actionable technical setup in energy producer PSX (Phillips 66), writing:
My work has been extremely friendly since the beginning of May, looking for PSX to break out of its 11-month corrective accumulation pattern that will trigger a thrust towards a potential target zone of 110-115.
On Thursday May 19, in the midst of some serious weakness and carnage in the retail sector that had equity market-watchers doubting the resiliency of the almighty US consumer, Mike Paulenoff turned MPTrader members attention to PARA (Paramount Global), writing:
For the past 5 months, we could make the technical argument that PARA has carved out an accumulation-base formation that attracts buyers every time the stock dips beneath 29.00. We can also make the case that every time the stock climbs above 36.
On March 11, with AAPL in a month-long down-leg and trading at 156.34, Mike Paulenoff posted a relatively bullish analysis for MPTrader members, writing:
I am watching AAPL more closely than usual these days, as a bellwether for the health/vulnerability of the overall market.
