Russell 2000 Update - AK Steel Holding Corp. (AKS) Gets Lift

Jul 14, 2017

Friday was another good day in stocks keeps the bears at bay for the time being. Even with some excellent earnings coming from a few of the big bank stocks today though, financials are getting beat up to close out the week. However, the S&P 500 seems to be gunning for its all-time high again, but whether or not it can get her done we'll see.

There continues to be a rotation of sorts over the last few weeks, where basic materials and commodities seem to be picking things up - along with healthcare and biotech - while tech stocks continue to somewhat lag a bit. It's going to be real interesting to see what happens when those big tech names start to report later this month.

As for small caps in general and some of our currently featured stocks, the Russell 2000 still seems to want to trade in an extremely wide range, but the longer this goes on the more it bodes well for the entire small cap space. It's a classic tip to Will O'Neill's Tea Cup and Handle charting patter, which suggests the long-term possibility of a breakout to the upside in small caps at some point down the road.

It's not as if there isn't value in the small cap space right now, but nobody really knows at this point if the Russell is going to finally break out, or simply start moving lower again.

We're finally getting some nice movement in AK Steel Holding Corporation (NYSE: AKS) after a number of days moving lower. All good now, but it's definitely going to need to find its way back above about $7 bucks if the stock is going to suggest even more upside ahead.

That's the last time it started selling off again, but if what I'm seeing with AKS does continue and with Trump's plans to put a tariff hammer lock on steel imports from abroad, AKS could end up being a beneficiary of sorts. It's not one of the stronger steel companies out there right now, but for investors who like sub $10 stocks, it's one worth having a look at.

Last, before we roll into the weekend, I showed you on thursday the recent move Senseonics Holdings, Inc. (NYSE: SENS) made a few days ago. Well, we got another move back to the upside today and based on what seems to be happening there, all it's going to take is one more big day and the stock could be ready to make an even bigger move.

It's really important to remember when it comes to really small stocks like SENS, there's usually always big short positions in those stocks, but it doesn't mean short sellers have it any easier than buyers do. What I'm saying is if the stock starts to really rally, those short sellers are going to have to cover.

As a matter of fact, it's usually the dumber short sellers that short something when it's way too low that end up getting their butts handed to them. The smart short sellers short high and cover low - just like smart investors buy low and sell high - or buy high and sell higher.

We'll see what happens with SENS. However, I wouldn't want to be short based on what the stock has been doing over the last few days.

See ya'll Monday.

Warmest regards,

SmallCap Network

Source: https://goo.gl/9MgmUC

November : Small Caps Biggest Winners

 About: iShares Russell 2000 ETF (IWM), Includes: AKS, ARIA, AST, BPI, CARA, CLF, EST

With a monster rally of 16.5% over 15 consecutive up days, the small-cap Russell 2000 index has seen one of its longest winning streaks on record. On that subject, in today's Chart of the Day sent to Bespoke subscribers, we looked at how the Russell 2000 has historically performed following the four prior periods where it went 15 or more trading days without a decline.

With the Russell 2000 up over 16% in the last three weeks in November, there have been a lot of big individual winners. In fact, 56 stocks in the index have rallied more than 50% since 11/3, when the winning streak began, with three of those names rallying more than 100%. The table below lists the 27 stocks in the index that have rallied 60% or more over the last three weeks. Looking at the list, a number of things stick out. First, you have probably never heard of most of these companies. Of the 27 names listed, just seven have market caps above $1 billion, while 15 have market caps of less than $500 million. In terms of sector representation, Healthcare dominates the list with 14 out of 27 companies.

While the rally in small caps last month has gotten a lot of attention, one thing to keep in mind is that it has been a small-cap rally. Even with more than 50 companies in the index rallying more than 50%, the index's total market cap has increased by just $305.9 billion. That may sound like a lot, and it certainly is, but to put that in the perspective of large-cap stocks, the total gain in market cap for the Russell 2000 in the last three weeks has been less than the market cap of Johnson & Johnson (NYSE:JNJ). That's still nothing to sneeze at, but it shows that when it comes to rotation into small caps versus large caps, it takes a lot less to move the needle on small caps than it does large caps

By Bespoke Investment Group

Source: http://seekingalpha.com/article/4026869-small-caps-biggest-winners