The chart shows relative performance for the S&P SmallCap iShares (IJR) and the Equal-Weight S&P 500 ETF (RSP). IJR represents small-caps and high beta stocks, while RSP represents the "average" stock in the S&P 500. The risk appetite is strong when small-caps and equal-weights outperform (risk-on). The 5-day EMA of the IJR:SPY ratio has been above the 120-day EMA since late May. This ratio is incredibly strong and this means small-caps are showing some serious relative strength.
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