From 2018 until mid 2020 the Russell 2000 index of small cap stocks (RUT) underperformed the SPX. After the September 2020 peak, RUT was stronger and made a new 2020 rally high in October, while the SPX lagged. We're seeing the same phenomenon again as RUT is making a new November rally high while the SPX lags. Follow the leader, like in October this is probably another signal that US stock could continue to rise.
Seasonal patterns for US stocks are bullish into at least early 2021. The SPX could reach the 3800's area.
Small cap stocks typically surge late in long-term bull markets, and usually top before the large cap stocks.
If we see the RUT underperform the SPX in the next several weeks, it could be an omen of a looming bear market.
Mark
Seasonal patterns for US stocks are bullish into at least early 2021. The SPX could reach the 3800's area.
Small cap stocks typically surge late in long-term bull markets, and usually top before the large cap stocks.
If we see the RUT underperform the SPX in the next several weeks, it could be an omen of a looming bear market.
Mark