Small-Cap Action Is Improving

 | Jun 01, 2017 | 11:12 AM EDT
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Stock quotes in this article:

IWM

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QQQ

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ntnx

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agn

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alxn

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bbry

The indices are trading close to flat once again, but we have a bit of a shift, with the small-caps' iShares Russell 2000 ETF  (IWM) outperforming the big-caps' iShares Nasdaq 100 ETF  (QQQ) . We also have much better breadth as a result, with almost three gainers for each loser. The number of stocks hitting new highs is also up to over 450 and new 12-month lows are down to just 50.

It is the reverse of what we have seen repeatedly in recent weeks -- and it looks like there is a computer algorithm at work that is programmed to push this reversal. These algorithms work best when they catch market players out of position and push them to make shifts that then create some sustained price moves.

It is certainly is a tricky market, but there are a few things of interest on my screens. My Stock of the Week, Nutanix (NTNX) is regaining its footing after a dip, and I've started a new position in BlackBerry (BBRY) , which is gaining traction as an autonomous car play. Citron is pushing the stock today and its hitting new highs on good volume.

There are some dead-cat bounces in oversold biotechnology, such as Allergan (AGN) and Alexion (ALXN) , but the problem for stock pickers has been the lack of sustained momentum. Only the FANG group has managed to keep running -- and today they are seeing some profit taking.

I don't have a lot of confidence in this market beyond the intraday action, but at least there is some better action in small-caps for now.

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