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Small-Caps Surge Past 1,200

Small-Caps Surge Past 1,200

2:05pm (EST)

We predicted today would be a bullish session with a possible pullback on Tuesday and into Thursday as overnight futures held up into this morning's open. Tuesday is a half session as the market closes at 1pm (EST) and most of Wall Street will be eager to wrap things up until Thursday. Of course, the market pros who think they deserve an extended holiday won't be back until next Monday.

As the market continues to make a run at our yearend fluff targets, one interesting development was the action in the small-caps. We have been calling for the Russell 2000 to make a run past 1,150 and possibly up to 1,175 once the rally resumed and today's OPEN surpassed those targets.

The Russell 2000 opened at 1,212.81 and kissed 1,213.49 in the opening minutes before coming back down to earth. The 5% move could have been a rebalancing act and either marks the high for the year or is one hell of a clue this level will be triggered in January.

We will try to get more on this story and update you in the morning on why there was such a surge but it is something worth noting.

We will be listing a ton of new trades on Tuesday and Thursday to play a continued rally as our portfolio is light and ready for action. We have already started our next batch of trades for January and we expect to be busy into yearend as we will be working while others are playing.

We will rest when the bulls take a break as the opportunities to make some nice gains still exist.

Earnings will be light this week and next so our trades will have to come from fundamental and technical analysis which is fine by us. We have said as valuations get stretched this will become a stock picker's market and one we thrive in.

As we head into the final few hours of trading, the Dow is up 62 points to 16,283 while the S&P 500 is advancing 8 points to 1,826. The Nasdaq is higher by 35 points to 4,140. The Russell 2000 has settled down but is north of 1,150. The small-caps are up 9 points to 1,155.

We have updates on our current trades as one of our plays has been all over the news today - in a good way. The call options we recommended on the name are up over 100% in just 3 weeks and we are looking for further gains as shares make a possible run from $7 to $10 and are up from $4 in a week.