Another way to view the small cap horizon is to look at the Russell 2000 ETF and see how it compares to the TZA. iShares Russell 2000 Index IWM (IWM) is the trading ETF to look at. Unlike the leveraged ETFs, the straight "normal" ETFs are in my opinion, perfectly fine to use as part of a portfolio. I especially think they are wonderful when used as a diversification tool.
The weekly chart isn't what I would consider overextended. Not enough to pull the trigger to short it (the same as buying a bear ETF). On the other hand, the daily chart is indicating to me that a pullback in price is now expected.
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