You all know how focused I am on the Granddad and Grandmother of my Economic Modern Family.

And, while SPY and Nasdaq soared to new highs, the Russell 2000 IWM and Retail XRT performed well, but not near new all-time highs well.

There was a perception going in that a Trump win would be better for Small Caps.

As Trump campaigned on increasing American manufacturing, Trump policies could also improve economic conditions and growth.

Furthermore, he proposes tax cuts, which along with reshoring, help small cap US-focused business the most.

While IWM rallied up 2 times more than the other indices today, and on pace to get to all-time at $244.50 the 2021 highs, it still needs to.

So, the Fed meeting could be the ultimate trigger.

Or the disappointment.

Granddad Russell 2000 IWM also needs retail or what we call grandma XRT to join in.

That spectacular 10-month trading range is still intact.
Over 80 in XRT we assume that trump policies perceived as deflationary and with the Fed potentially cutting rates will be great for both IWM and XRT.

The IWM chart shows a wonderful gap higher.

IWM now outperforms SPY.

Plus, the momentum improved significantly.

Can IWM keep going? So much depends on the FED and interest rates.

XRT also enjoyed a gap higher, but not nearly as pretty as IWM’s.

XRT must clear and hold above 80.00.

Furthermore, XRT outperforms SPY by a little and momentum rose but not by nearly enough.

The inside of the Family has more to prove.

ETF Summary

(Pivotal means short-term bullish above that level and bearish below)

S&P 500 (SPY) Runaway gap or island top???

Russell 2000 (IWM) 227 support 244 the area to clear

Dow (DIA) New highs

Nasdaq (QQQ) 500 support

Regional banks (KRE) See how ranges work? This cleared 62 and off to the races

Semiconductors (SMH) 265 resistance

Transportation (IYT) We have a Dow theory thing going on-71 now key to hold

Biotechnology (IBB) 140 support 147 resistance to clear

Retail (XRT) 76 support 80 to clear

iShares iBoxx Hi Yd Cor Bond ETF (HYG) 79.50 pivotal and interestingly HYG still below

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