The Russell 2000 small-cap index broke out to a bull market and all-time high last week, raising the odds for significant gains in the fourth quarter and beyond. The hottest components could offer stronger returns than the iShares Russell 2000 ETF and other small-cap funds, but these issues can be tough to find because they often fly under the radar, avoiding Wall Street and media attention.
Market players can identify these hidden gems through a technical scan that sorts the index’s 2,000 components by percentage positioning relative to the 200-day exponential moving average (EMA). For example, a stock that is 10% above the moving average will occupy a higher slot on the list than one that is just 8% above it. Once sorted, the sector’s biggest winners float to the top for easy identification and further analysis. (See also: Russell Breakout Lifts Small Caps Into Leadership.)
The Russell 2000 broke out above three-year resistance last week, a positive sign for its strongest small-cap components. …read more
Read more here: 3 Under-the-Radar Small Cap Gems
Category: FGEN, UCTT, NVMI