The Dow surged to a new record high today as Small Caps slump post-USMCA…

Another major divergence between big (Dow) and small (Russell 2000) stocks as the former soars relative to the latter and erases any relative performance YTD…

This is the biggest outperformance of Dow over Small Caps since Oct 2011.

Both are now up just over 8% on the year… (Trannies are worse. Nasdaq best)

Notably Russell is dominated by financials and they have massively underperformed…

Macro Risk Advisors technical analyst John Kolovos notes:

“Even though the S&P 500 is OK, the rest of the market is not. Very worrisome breaks in small and mid-cap stocks, as well as poor market internals with a growing percentage of stocks at one-month lows and internals trends at their weakest since April.”

While key price support levels are holding, a few more days of this kind of action will change the narrative to something more sinister.

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