Charting the Markets: When Will the Russell 2K Join the 'All-time High' Party?
Small caps have yet to make a convincing run to new territory.
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It's been a long time coming since we last saw the small cap Russell 2K (IWM) hitting new all-time highs. There is probably a bit of jealousy at work here too, the other three indices (S&P 500, Nasdaq and Dow Industrials) seem to be moving to higher ground weekly. The S&P for its part has hit new highs 43 times in 2024, and as of Friday's close the Dow Industrials closed at a new all-time high.
To make a run at the old highs the IWM would have to close above $230 for a couple of weekly bars, then make that move to the $243 level. The current price of $220 is about 10% below that high from September 2021. It's been a long three-year stretch but we think the market and economic conditions are ripe for a run to new highs in 2025.
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The chart is constructive, the IWM has a bullish crossover on the MACD currently while the stochastics just flipped to a bullish signal. The Russell 2K does well when momentum is strong. Money flow is bullish too after a dip into bearish territory over the summer.
Patience is clearly needed here but with a strong bull run by small caps in the new year that might just serve to push the other indices even higher.
