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Patrick Dunuwila

Chart of the Day - Tuesday, August 12, 2025

August 12, 2025


🏆 Today's Chart of the Day was shared by Mike Zaccardi (@MikeZaccardi).
 

  • The Russell 2000 ($IWM) had its third-best session of the year today, rising +3.0%.
 
  • It outpaced the S&P 500 ($SPY) by +1.9%, marking the best day for Small-Caps versus Large-Caps since November 6th, the day after the election.
 
  • $IWM/$SPY remains in a clear downtrend, but it wouldn't take much to reverse it. Large speculators are still heavily short Russell 2000 futures, leaving ample runway for the recent outperformance to continue.
     
The Takeaway: Today was the best day for Small Caps vs. Large Caps since the election. The ratio is still trending lower, but with the recent momentum and plenty of shorts to squeeze, Small-Caps have all the ingredients for a juicy move in the near term.
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