Shoot That Star

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Because the addition of the daily/weekly/monthly bar choice in SlopeCharts is still so new, I had sort of forgotten it was even there. By chance, however, I was curious to see what the monthly charts looked like (since we just finished another trading month), and……my, my, my……

The above is the Russell 2000 small cap index, which has shown so much strength lately. It is showing an absolutely textbook-perfect shooting star pattern, which is a reversal pattern for a top. How many others do you see on the chart? Zero.

The same, of course, is true for the ETF equivalent, the IWM:

Of course, maybe you think the nearly 300% gain already exhibited in this index is utterly reflective of how healthy the economy is, how bright the future is, what with North Korea being our buddies and all, and how a world buried in hundreds of trillions of dollars in debt is a recipe for organic growth. If you think that way, buy it all. No one is stopping you. Good luck.

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