We are starting off the week with our Trend Analyzer showing most major US Index ETFs as overbought. Currently, 9 are overbought, 5 are neutral, and none are oversold. The Dow (DIA) still leads the group having seen the largest gains last week. Micro-Cap (IWC) is back at its 50-DMA. This is below where it was on Friday but still is an improvement from where it was for the better portion of last week.
As we mentioned last week, small and mid cap ETFs have been underperforming recently. Most of these funds have seen either losses or are barely positive in this time span. Notably, the Core S&P Small-Cap (IJR) has the second greatest gains YTD, but over the past week it has been selling off. At its current level, the ETF has fallen 1.15% over the last week, moving from overbought to just above its 50-DMA.
September has so far been a month that has seen the equity market gain, but new leadership has emerged as the year’s previous winners have experienced mean reversion. This is a sign of a healthy market.