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Russell 2000 vs SP500: Testing Critical Support Trendline ?
January 5 ( From TradingView )
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Financial assets like the SP500 had a very good performance indeed; and the small
capitalization outperformed big ones a lot but starting to meet huge resistance and
turned bearish since March 24 2014....
Even the main technical indicators like the Russel 2000 Index and the SP500 is showing
a triple top on a ratio basis.
The first top was in October 2013 and the second one in
January 2014 and the third one in March 2014. Interesting to note that this ratio reached
new highs and occured in a stock market correction in all 3 cases as you may see in
the chart below ( Ellipses )...
The 21 DMA ( Day Moving Average ) turned downward on December 4
and then gives a short term sell signal for the Russell on a relative
basis compare to the SP500...
But the real interesting part is that since this ratio Tested the Resistance Level ( On June 25 2015 ) from a Trendline that started on February 2012 and then can gives a real wall of Resistance to the Russell on a Relative Basis to the Mighty SP500; Since then Russell underperforming tremendously the Mighty SP500.
( See chart below - Red Trendline - middle of the chart ).
We are now back at the Major Critical Support Trendline that started back on February 2 2010 and on the downtrend channel support also: breaking that support will bring a lot more underperformance from the Russell 2k vs the Mighty SP500. ( See chart below - Amber Line - Bottom of the chart ).
The market still favor the most liquid stocks over the smallest less liquid stocks; a bearish behavior indeed...
Russell 2000 vs SP500: Testing Critical Support Trendline ? $SPY, $IWM #Trading #russell2000 #SP500
Russell 2000 Over SP500 ( Blue Line )
21 DMA ( Top Panel - Yellow Line )
SP500 Index ( Candles )