Monday, July 23, 2012

Small Caps Underperformance

Futures went down big in pre-market, creating a big gap lower for all major indices. Cause of all this was (more) bad news from the Eurozone. Spain is looking for a bailout (Spanish yields are now near 7.5%, way beyond the dreaded 7%-limit) and some media claim that Greece won't be receiving the next payment from the IMF.

Indices closed well off their lows, which is good news for the bulls. Support levels (the lower trendlines on the daily charts) held, but is this only temporary? Also worth noting, small caps are underperforming other indices and closed outside the flag (see daily charts). Will this flag turn out to be a bearflag?

5m-chart SPY:

Dialy charts DIA, SPY, QQQ and IWM:

Euro, oil, metals
The euro, gold and silver went down, but losses were not that big (all under 1%).
That can't be said about oil (-3.8%) and copper (-2.1%).

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