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I drastically reduced small-cap exposure already, but still own some in MSCFX. Lately it's getting beat up. This guy is correct? What's to look forward, too, then?
looks like RUT is flat to up in a down market today.. the worst might be over for small caps. @Crash, if you haven't sold until today, you just probably relax -- there is always something going down in a diversified portfolio (unless of course your entire net worth is in small caps.) best, fa
This is where a little bit of understanding of technicals would be useful. You can get a better perspective of the big picture than hoping every wiggle means something. There is also a lot of technical trading going on that makes these a self-fulfilling prophecy.
Technically, small caps are very broken. They are below the 200 day SMA and bouncing along the lower bounds of the channel in a strong downward trend. You can have several bounce backs up to the 20 day SMA (2%) without changing the trend as has happened all of April. It has to break through that and perhaps even the 50 day SMA (about 6%) before technical trading snowballs it the other way.
Technically, biotechs have a much better chance of recovering sooner than small caps.
Risk off and momentum trades from too much money floating around is what this current market is all about and may continue through the summer.
Comments
Technically, small caps are very broken. They are below the 200 day SMA and bouncing along the lower bounds of the channel in a strong downward trend. You can have several bounce backs up to the 20 day SMA (2%) without changing the trend as has happened all of April. It has to break through that and perhaps even the 50 day SMA (about 6%) before technical trading snowballs it the other way.
Technically, biotechs have a much better chance of recovering sooner than small caps.
Risk off and momentum trades from too much money floating around is what this current market is all about and may continue through the summer.
Sit tight or momentum trade, only two options.