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Anyone think smallcaps will recover anytime soon?


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#1 brucekeller

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Posted 28 December 2021 - 10:41 PM

Seems like anything under a 40B market cap has been getting shorted for almost a year now since that GME hype and incredible runup before. During that time, the major indexes outside of the R2K have had stellar years albeit with incredibly pathetic breadth and 25% of the components driving the indices. 

 

Basically seems like the big caps are the 'flight to safety' since you can't do bonds and crypto is way too volatile; and the hedgies figured they might as well short the crap out of low caps in the meantime, with redditors being willing knife catchers. 

 

Think that's been all in anticipation of the Fed tapering that should complete by March and that's it's been a huge red flag?  Or think more it was just extreme overvaluations so made a great short target with inflation expectations and now are way too oversold and due for a rebound? 



#2 pdx5

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Posted 29 December 2021 - 12:23 PM

Nothing is safe on top floor of a house of cards.


"Money cannot consistently be made trading every day or every week during the year." ~ Jesse Livermore Trading Rule

#3 tradesurfer

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Posted 29 December 2021 - 12:35 PM

Maybe it is more of a question of will January be a down month or an up month..... 

 

January barometer indicating that 2022 will be a down year...

 

so if January is going to be negative month.... wouldnt that mean we should very soon see negative price action that leads into a more down January...



#4 pdx5

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Posted 01 January 2022 - 04:40 PM

These are very unusual times. There was never a covid type pandemic in recent years.

People are in panic, rushing out to get get experimental vaccines by the millions, almost 75% of Americans!

And the governments are flooding the system with liquidity. The stocks and real-estate bubble is already huge.

But bubbles can get lot bigger than rational. So I am not going to rush out and short the market right away. 

Between me and my wife, we received crazy amounts of stimulus money based on our incomes before 2021.

But in 2021 my capital gains are more than my combined taxable income of past 10 years. This is all nuts.


Edited by pdx5, 01 January 2022 - 04:43 PM.

"Money cannot consistently be made trading every day or every week during the year." ~ Jesse Livermore Trading Rule