Chris comments: The Russell 2000, a small-company index, has outperformed the S&P 500 index by almost 10% over the past 12 months.
A predictable rising channel has formed over the past year, creating quality buy and sell lines in the sand. Currently this small cap index finds itself at the top of its trading range and up against a new falling channel line.
This index suggests that bigger isn't always better, yet if the "Power of the Pattern" remains in play, harvesting the small companies at the top of the range might be a good idea until a breakout takes place.
