Mid Caps Leading Small Cap Stocks

11/01/2010 9:42 am EST

Focus: STRATEGIES

Thomas Aspray

, Professional Trader & Analyst

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The small and mid cap stocks underperformed the S&P 500 throughout much of the summer as the relative strength (RS) lines on both the S&P 600 and S&P 400 were declining. This changed in the latter part of September as the downtrend in the RS for the S&P 600 was broken (see arrow). The RS line is in an uptrend but is still below the April highs. The mid cap S&P 400 held up better during the summer and the RS line is above its April highs even though the index is about 2% below the April peak at 852.90.

Tom Aspray, professional trader and analyst, serves as video content editor for MoneyShow.com. The views expressed here are his own.

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