Russell 2000 and S&P 600 Small Cap Indexes Daily Charts in -10% Corrections

Small cap stocks bite the dust and are now in a correction. Wall Street labels a -10% drop from record highs as a 'correction' and a -20% off the top is called a 'bear market'. These are bonehead metrics but everyone watches them so they are important. They are bonehead because, as the chart above shows, an index or stock may fall into correction but if you blink it comes out quickly.

At the start of the year, the small caps gave up the ghost and fell into a correction. But by the time Keystone got up to get a cup of coffee, feed the animals, and return, the correction was over. So take the metrics with a grain of salt. There are other gauges that dictate bull and bear markets, in all time frames, far better.

The Russell 2000 tops out at Thanksgiving, 11/25/24, at 2466 so anything below 2219 is a -10% correction. The RUT gave it up to start the year but then gapped up on the happy Donnie talk, Fed escapades, and AI hype. Alas, the little ones could not bear the weight of the market, so their knees buckled and the Russell 2000 is now firmly in correction.

The S&P 600 Small Cap Index is the same dealio. SML topped-out on 11/25/24, the same day as the RUT, at 1560. A -10% correction is 1404 and below. The S&P small caps followed the same path as the Russell 2000 small caps.

What happened to all the jackasses on television that kept telling everyone to buy small caps with both fists? Well, they are laughing since they cashed-out, pumping and dumping their stock to Joe Sixpack, Carlos Bagholder and Melissa Sucka, that always show up to hold the bag. It's fun. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.