Apple, Nasdaq, and Russell 2000 Look Ready to Bounce
Here are some affordable ways to play a bounce/rally in the coming weeks.
Russell 2000 Index (INDEXRUSSELL:RUT)
I really like the Russell 2000 Index because small-cap stocks can rally hard and fast, outperforming the large caps like AAPL, S&P 500 (INDEXSP:.INX), Nasdaq, and Dow (INDEXDJX:.DJI). This index is looking ripe for a bounce in the coming days which could trigger the next major rally to new highs. You can plan this index through TF ("mini-sized") Russell 2000 Index futures contracts such as iShares Russell 2000 Index ETF (NYSEARCA:IWM), Direxion Daily Small Cp Bull 3X Shs ETF (NYSEARCA:TNA), and UMA exchange traded funds. [Editor's note: Unified Manged Account is an investment service which creates one account for all of an investor's holdings of separately managed accounts, mutual funds, ETFs, etc. The service is offered by several providers.]
This setup looks very promising because the election is almost over and the Santa Clause rally is just around the corner. But know that some of the biggest drops in the market happen during times when the market is running the stops. It is a natural tendency to take big positions which things look great, but that is not how you should do it. Take calculated position sizes, knowing indexes could fall another 2-3% before putting in a real washout bottom.
Editor's Note: Chris Vermeulen offers more content at his sites, TheGoldAndOilGuy.com and Traders Video Playbook.
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