Small caps as measured by IWM are key for the fall and into 2024.
You can also look at SML S&P 600.
IWM could be forming an inverted head and shoulders bottom going back from the start of 2023. (See the rectangle area of the IWM chart)
SPY QQQs, on the other hand, could be forming a head and shoulders top. (See rectangle area of the QQQ chart).
If this does not tell you where we are at–equal potential to see IWM lead us up if clears back over 190 or-
A more significant down move if fails 180 under the pressure of QQQs should they fail the head and shoulders neckline.
Our MarketGauge quant models are aside in small cap all-stars yet long small cap earnings growth.
This means that the strength is in the stocks that have merit based on earnings and not as correlated to the indices.
Have a listen to August 24th live coaching session where we cover the indices, economic modern family, and market outliers:
https://marketgauge.com/mdaily-20230827
And stay tuned as Monday August 28th on the close of the day, Mish will be guest hosting for David Keller on Stockcharts The Final Bar.
Twitter: @marketminute
The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not represent the views or opinions of any other person or entity.
