Stock Market Outlook: Small Cap Stocks Lagging

Brandon Van Zee

The S&P 500 (NYSEARCA: SPY) broke its 5-day win streak with a very minor .03% loss today.

All four major U.S. stock market indices continue to have bullish intermediate postures; the Russell 2000 is most at risk of reverting back to a bearish posture.

All four major U.S. stock market indices have a “3 Green Arrows” signal except for the Russell 2000 (NYSEARCA: IWM) because it continues to have a hard time closing above its 30 day moving average.

The Russell 2000 is the only major index with a “death cross” on the 10 week/40 week moving average crossover system.

U.S. government long bonds, foreign bonds, and REITs all had positive days and strongly bullish intermediate postures.

The U.S. Dollar continues to have a bearish intermediate posture and is trading below a falling 30 day moving average for the first time since January.

Get market insights, stock trading ideas, and educational instruction over at the Market Scholars website.

Mid-Week Stock Market Video – June 11, 2019

Some additional insights from today’s stock market outlook video:

  • As a result of that Dollar weakness, many foreign stock markets have been perking up lately; Russia and Australia appear to be the current leaders.
  • China is the only major foreign stock market with a bearish intermediate posture and it sits at a critical juncture (exactly on its downtrending 30 day moving average).
  • After the strong performance in the last two weeks, the only U.S. sector with a bearish intermediate posture according to the Market Forecast technical indicator is Utilities; Materials and Industrials have bearish two-day candlestick patterns.
  • The Sector Selector rankings mostly favor defensive sectors, but it’s interesting to note that Consumer Discretionary had a big surge on a week-over-week basis.
  • Our trade application example featured selling a bear call spread on Boeing (BA) due to its continued down trend and its struggles the last couple days to get above the falling 30 day moving average.

Twitter:  @BrandonVanZee and @Market_Scholars 

Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.