IWM - New Highs
$IWM has been the leader of the indices. Usually, when something like this happens, people wonder if this is a chart to short. Mean reversion has to happen at some point, and $IWM should correct and come back down, right?
As trend traders, the last thing we want to do to $IWM is to short it. It’s fine if we don’t get long new highs, but it’s definitely not our job to pick the tops and predict price movement. Rather, it’s simply our job to follow price - that’s it.
Here’s the chart of $IWM on the daily:
Today, we’ve put in another new high. The market is clearly signaling that risk is on. For those that are hesitant to get long the $IWM, there are numerous stocks to choose from in the small cap sector. Pick one that’s trending up, get in with an appropriate stop placement and position size, and ride the trend for as long as you can.