For a long time, the performance of US stocks in the mid-cap stocks was inferior to large-cap stocks. This may also be the reason for the weakness of the broader market in the past year.
The picture shows the ratio of the S&P mid-cap stock index to the S&P 500 index (medium stock/large-cap stock), with the ratio running in the channel. At the end of 2016/early 2017, the ratio test channel upper rail resistance (1) was blocked and fell back.
The current price is being tested at (2) for 8 years, and the momentum indicator is at oversold level and may form a low point.
In the past, mid-cap stocks often rebounded when momentum indicators hit current levels (shown in shades of green).
AnalystKimble pointed out that if the ratio is supported by a rebound, it means that the mid-cap stocks will outperform large-cap stocks in the future.
(Article source: Chart home)