The Russell 2000 just hit another all-time high.

In fact, it just broke to a high of 1,639.89 and we believe it could be headed to 1,700.

All as small cap stocks sharply outperform their large cap counterparts.

Even the S&P 600 small cap index is sitting at record highs, too thanks to energy stocks that have gotten a big boost from a recent jump in oil prices, which analysts say could boost earnings forecasts for the sector.

“The strength in small-caps may be a signal that investors are becoming more confident in the economy recovery,” said Lance James, who manages about $3 billion in small-cap funds as a senior portfolio manager of U.S. equities at RBC Global Asset Management, as quoted by Market Watch “If we see a rotation into the cyclical sectors of the small-cap universe, that could signal more gains ahead.”

Analysts at B. Riley FBR just predicted the Russell 2000 could continue jumping to new highs with a target of 1,800 – a 16% jump from where the year began.

They also believe small cap stocks are far better positioned to weather a strong dollar, and recent controversial trade policies. Plus, the group will continue to benefit from lower effective tax rates that could create big upside earnings surprises.

“We’re in the early innings of this run,” they note, as quoted by CNBC.  “This is a trade that’s got legs.”

Other analysts believe that small caps will push higher because most derive a bulk of their revenue from insider the U.S., shielding them from the overseas’ headwinds many of the larger cap names have been dealing with.  Plus, small stocks are less impacted by a stronger dollar, which makes U.S. goods sold abroad more expensive.

Meanwhile, large cap stocks have failed to reach record highs because of recent trade tensions thanks to tensions over overseas issues, such as trade war concerns.

In short, it’s been a great year for small caps so far… with no end in sight.