It may be a new year, but things are still oversold as seen in our Trend Analyzer as every one of the major index ETFs remain oversold. Granted, since last week’s post-Christmas rally, things have moved well out of the extremely oversold range that all of these ETFs had been trading within in recent weeks. For the first time in a while as well, all of these names we track are seeing green over the past five days. Ironically, the Micro-cap ETF (IWC), which had been the most beaten down by the end of 2018, has seen some capitulation and is now seeing the biggest gains of the group. IWC is up the most both over the past five days at 3.89% and for the first trading day of the year yesterday at +1.7%. In both respects, it leads its peers by over a percentage point.
While we’ve seen a bounce over the last week, it must be noted that each of these ETFs are still firmly in downtrends. Additionally, they are all still well below their 50-DMAs. So bulls still have their work cut out to improve the long-term picture.