Friday’s declines brought the major US index ETFs back below their 50-day moving averages. Although these ETFs closed out the week lower, only the Russell 2000 (IWM) and Micro-Cap ETF (IWC) were down over 1%. IWC, in particular, continues to be the weakest of these major indices. Falling 2.2% last week, it is once again approaching extreme oversold territory. IWC is also still the only one to show a downtrend in our Trend Analyzer.
Using our Chart Scanner, you can see the fake-out of a break above the 50-DMA for the major index ETFs. Small caps are also looking to move below their 200-DMAs as IWC has already done so. As previously mentioned, although only IWC is in a downtrend in our Trend Analyzer, other small caps like the Core S&P Small-Cap ETF (IJR) and the Russell 2000 (IWM) have made a series of lower lows in the past six months. But the major distinction is last week’s declines did not bring IJR or IWM to a new low. Similarly, for the rest of the major index ETFs, which currently sit between their 50 and 200-DMAs, the recent volatility has also marked higher highs and higher lows. In other words, while the past couple of weeks have seen dramatic movements, they have yet to do any real damage to recent trends. Start a two-week free trial to Bespoke Institutional to access our Trend Analyzer, Chart Scanner, and much more.