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Russell 2k - DJ Industrial Ratio: Russell Underperforming ?
October 14 ( From TradingView )
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Financial assets like the Dow Jones Industrials had a very good performance indeed;
the small capitalization start to underperform tremendously against big ones since March
18 2014 and finally reached a bottom on a relative value on October 10 2014.
( See blue line on the chart below ).
It reached on a ratio basis, the highest level ever on March 18 2014 !
On a Ratio basis ( Russell 200 over the Dow Jones Industrial ), the 21
Day Moving Average is in a downward phase ( yellow trendline on the
chart below ) since July 7, indicating an underperformance of the
Russell 2000 compare to the Mighty Dow Jones Industrial.
( Grey Vertical Line ine on the chart below )
But one interesting factor is that we broke a Major Support Trendline that started back on October 10 2014 on that ratio ( Russell 2000 over DJ Industrial ) and the Underperformance of the Russell is more severe since then. . ( Red Trendline on the chart below - Ellipse )
Observe also the Breakdown on the Russell 2000 from a Major Support Trendline broken on June 29 2015 at the 1260 level ( now becomes Major Resistance ). It did retest it on July 16 and was rejected.
( Red Trendline on the second chart below - Ellipse )
We broke the 200 DMA ( Day Moving Average ) zone on the Russell 2000 on August 6 ( 200 DMA Green Line - on the second chart below ) and had a Death Cross on September 2, another bad technical set up.
But the most interesting factor is that we tested on October 13 the 50 DMA ( Day Moving Average - Red Line - second chart below ) then at 1161.9 and also the Major Resistance Trendline that started back on July 16 and failed to break both levels. ( Amber TrendLine - on the second chart below )
Russell 2k - DJ Industrial Ratio: Russell Underperforming ? $SPY, $IWM #investing #russell2000 #dowjones #SP500
Russell 2000 Over Dow Jones Industrial ( Blue Line ) 21DMA ( Yellow Line )
Russell 2000 Index ( Candles)
20 DMA ( Yellow Line )
50 DMA ( Red Line )
200 DMA ( Green Line )