FYI: We noted last month that the performance reversal between small caps and large caps in early September brought the two benchmarks to a pivotal point at the upper bound of the trend line that was established in mid-2018. While small caps teased a breakout, the top line of the channel proved to be a point of resistance for small caps once again as they quickly gave up all of their gains and are testing recent lows.
Absent a return to early-cycle macroeconomic dynamics, we continue to find it challenging to make a case for sustainable outperformance for small caps relative to large caps and expect large caps to post their third year of relative outperformance in 2019, which has not occurred since the late 1990s.
Regards,
Ted
https://www.fa-mag.com/news/small-caps-find-resistance-52417.html?print
