Smaller Advantages:

As in life, with stock markets sometimes it is helpful to be smaller in stature. It is easier for a smaller cap company to maneuver, as it has the advantage of agility, unlike a mega cap supertanker that takes a long time to adjust. Of course scale matters, but some smaller names have taken on the challenge against an AMZN, or at least some of the charts, and PRICE action, are saying so and that is all that matters to us. Many of these names reside in the XRT, a more “equal weight” consumer ETF. It trades right at a cup base breakout pivot, and to be frank we would like to see it accelerate higher from here a bit faster, as we know the best breakouts tend to work right away. Another smaller analogy regarding something special to me is in tennis. The shorter, more nimble player is faster and normally able to run down lots of balls, eventually wearing out the taller, less “athletic” player that will have trouble generally with his or her mobility. Perhaps the best thing for the ETF this week would be if it can CLOSE very taut to where the last two did, and form a bullish 3 week tight pattern after the weeks ending 10/2-9 added a combined 10.3%.

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