Chart of the Day - Thursday, October 12, 2023

Today’s Chart of the Day was shared by Shane Murphy (@murphycharts). The S&P 500 bottomed exactly one year ago today, with October 12th, 2022 marking the end of the bear market... for Large-Caps. Meanwhile, Smaller-Cap indices have fallen deeper into bear market territory. Shane points out that Micro-Caps ($IWC) made a new cycle low today, closing at its lowest since November 2020. As of today, $IWC is down nearly -40% from its March 2021 highs. If you define a bear market as a -20% drawdown, what do you call a market that’s down twice as much? $IWC attempted to reclaim $100 earlier in the week, but this former support level turned into resistance. It would be very bullish if $IWC reclaimed $100, as this would mark a failed breakdown, but that’s proving to be a difficult task.