The iShares Russell 2000 (NYSEArca: IWM) rose to a new all-time high at Tuesday’s open as small-cap ETFs continue to outperform the S&P 500 since mid-April.

Meanwhile, the relative performance chart for IWM versus the S&P 500 is at its best level since mid-2011, according to Investors Intelligence technical analyst Tarquin Coe.

“Momentum is not overbought, so further gains are possible. However, one needs to be on their guard, as momentum could roll-over and print a bearish divergence,” he wrote in a newsletter.

“We remain cautious the market in general over the medium-term so stops on new small cap longs need to be as tight possible, as they could turn on a dime,” Coe added.

IWM, the small-cap ETF, is up 8.7% for the trailing three months, versus a gain of 5.5% for the S&P 500, according to Morningstar.

iShares Russell 2000

Full disclosure: Tom Lydon’s clients own IWM.

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