- Technical Commentary -

July 16, 2009 (Financialwire) — Dr. Joe Duarte recently noted, “The Small Stock Russell 2000 ETF (NYSE: IWM) could deliver an upside surprise if current trend remains in place.”

Duarte added, “The stock market has surprised the majority of investors over the last few days. Much of it has had to do with better than expected earnings from Goldman Sachs and Intel, two large cap stocks. Yet, small stocks have also recovered some lost ground, albeit more quietly.”

“IWM, an ETF that houses the stocks in the Russell 2000 index of small stocks,” Duarte continued, “has found support at its 200-day moving average and is looking to move back above its 50-day moving average near 50. If that happens, we could see a move back toward 54 on the ETF.

“What happens at the 53-54 area is what will write the script for the next few weeks, as momentum investors could pile on and drive prices higher.

“Small stocks are important to the market as they are the area where growth oriented mutual funds and momentum traders like to prowl. Some of these stocks are fairly illiquid and could have big moves in short periods of time.”

Duarte’s conclusion: “Small stocks are also important in fueling market breadth indicators such as the NYSE advance decline line. When these indicators turn positive, they will usually bring in more buyers. That means that a good run in the small stocks is likely to spread the cheer for all investors. We’ll see what happens.”

In addition to his regular FinancialWire(tm) contributions, more commentary from Dr. Joe Duarte is available at “Dr Joe’s Market Diagnosis” blog, hosted at Investrend Weblogs (http://www.investrendweblogs.net/jduarte/). Also visit Duarte’s web site (http://www.joe-duarte.com) for all of Duarte’s technical analyses and insights.

More About Dr. Joe Duarte:

One of CNBC’s original Market Mavens, Dr. Duarte has been writing and providing expert commentary about the financial markets since 1990. Duarte has combined expertise in health care, energy, and the effects of politics and global intelligence on the financial markets offer a unique blend of insight and information to thousands of active investors and political and intelligence aficionados around the world on a daily basis. In early 2001, Duarte correctly predicted that Venezuela’s political problems could lead to an energy crisis in the United States, and, in 2003, Dr. Duarte received second place in the professional section of the Medical Economics Investment Challenge with a 12-month return of 42%.

Duarte has authored numerous books on investing, including, “Futures And Options For Dummies”, “Successful Energy Sector Investing”, “Successful Biotech Investing” and co-authored “After-Hours Trading Made Easy.”

Duarte has appeared as a weekly guest on Market Mavens Radio and has logged appearances on KNX radio in Los Angeles, Financial Sense.com radio, and Wall Street Radio. His articles and commentary have also been featured on CBS Marketwatch, Barron’s, Smart Money, Medical Economics, and in Technical Analysis of Stocks and Commodities magazines.

Subscriptions to “Doctor Joe Duarte’s Market I.Q.” are available at his web site (http://www.joe-duarte.com/free/order_choices.asp), his most recent book “The All New Market Timing For Dummies” is available online (http://www.tinyurl.com/market-timing), and Duarte’s “IntelligentForecasts” (http://www.intelligentforecasts.com) provide free news coverage and analysis, and his daily articles and news summaries offer recommendations and analysis for ETFs, and individual stocks in the technology, health and biotechnology, and energy sectors.

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