TECHNICALS-SMALL CAPS

DJIA Futures set to open lower by 20 points and right at/near the YM Pivot Point- so maybe a quick trade is in the offing; is there any doubt that the dip buyers buy the gap lower?

The Russell 2000 continues to do well and is approaching its May highs. Also the chart has the beginning look of a cup and handle on the weekly chart. It has had this look before and every time was a good time to pick up some shares. And with all the talk of the big caps and the DJIA, of course the IWM is the big winner for the month of October.

My philosophy, if you think stocks will do well and you want to buy an index, buy the IWM, as they will outperform (IMVHO) if stocks go up. If you think stocks are going lower go to cash and don't follow the logic of the bubble lights, the big caps will outperform buy going down less. Revshark at realmoney.com had a nice little peace on why investors are generally better off with small caps and it is worth reading.