Click on picture to enlarge

The past year has been a little bit rough on small caps, as they have underperformed against the SPY by almost 8% over the past 12 months. When looking back over the past few years, small caps haven't lagged the S&P by that much in the past 5-years. 

Anything caused this under performance? It's possible that the combo of 7-year resistance and a 161% Fibonacci extension at (1) might have influenced prices and had something to do with small caps doing nothing more than trading sideways for a year. 

As you can see at (2), the Russell/SPY ratio is oversold, at 5-year channel support with momentum low and attempting to move higher.

Joe Friday…The under performance of small caps to large caps is due a change and would want to own small caps should they break above dual resistance at (1).