Tactical Trends: Value and Small Caps Reclaim Ground in Equities

Relative breadth improved, but the 45pp gap keeps leadership selective.

Rotation into value and small caps strengthened by the August 19 close, with 52 of 59 equity ETFs (88%, +1.7pp) above their 20-day moving average (20D MA) and 25 of 58 (43%, +13.8pp) above their 20-day ratio moving average vs the S&P 500 SPY (20D ratio MA vs SPY). Equal Weight S&P 500 RSP, S&P Value SPYV, and Small-Cap VB crossed above their 20D ratio MA vs SPY, while Technology XLK and Russell Growth IWF crossed below. The 45pp price-relative gap narrowed. Low-volatility, developed ex-US, and China clusters hold above their 20D MA and lag the benchmark inside that spread, so price participation runs ahead of leadership.

Fixed income shows 16 of 17 ETFs (94%) above their 20D MA, but only 6 of 16 outperform the Aggregate Bonds AGG. High-yield credit and Long Treasuries TLT lead the relative winners, while investment-grade credit and short-duration funds lag the benchmark. Bond participation concentrates in spread product and the long end. The duration split reflects rate sensitivity.

Specialty leadership vs the S&P 500 SPY concentrates in crypto and precious metals, with Bitcoin Trust IBIT in the relative winner cluster and Semiconductors SMH below its 20D MA. Commodities vs the S&P 500 SPY favor oil, broad commodity, and agriculture exposures, with copper in the laggard cluster. The non-equity leadership set is selective and tilts toward alternative beta and inflation-sensitive assets.

20-Day Tactical Breadth

Key Takeaways

Ethereum ETHA, up 6.29% relative to SPY over the trailing 20-day window, crossed above its 20-day ratio moving average. Bitcoin Trust IBIT also crossed above its 20D ratio MA versus SPY, while Managed Futures DBMF and Momentum Factor MTUM crossed below their 20D ratio MA. Specialty relative strength splits between crypto winners and alternative-strategy laggards.

Long Treasuries TLT crossed above both its 20D MA and its 20D ratio MA versus AGG. 3-7yr Treasuries IEI, Int. Treasuries VGIT, and Short Corporate VCSH crossed below their 20D ratio MA versus AGG. Relative bond strength favors the long end over intermediate and short duration.

Intl Quality IQLT, Developed Markets VEA, and Europe VGK crossed above their 20D ratio MA versus SPY, and equity cross-timescale alignment stands at 83%. Cross-timescale relative leaders cluster in quality, dividend, and small-cap exposures, while Brazil and India anchor the laggard side. The equity rotation reaches across region and factor lines rather than a single domestic style bucket.

FEATURED ETF: iShares Ethereum Trust ETF ETHA vs SPY

Other Technical Signal Events

Equity: Price vs 20-day MA

Signal	Ticker	Name	20D perf
Cross-up	XLB	Materials Select Sector	+3.35%
Cross-up	MCHI	iShares MSCI China ETF	+3.40%
Cross-up	FXI	iShares China Large-Cap ETF	+3.63%
Cross-down	XLI	Industrial Select Sector	+1.73%
Cross-down	SLYG	SPDR S&P 600 Small Cap Growth ETF	+1.73%

Equity vs SPY: Price Ratio vs 20-day MA

Signal	Ticker	Name	20D rel perf
Cross-up	EEM	iShares MSCI Emerging Markets ETF	-1.14%
Cross-up	XLP	Consumer Staples Select Sector	-0.33%
Cross-up	IWM	iShares Russell 2000 ETF	-0.19%
Cross-up	VT	Vanguard Total World Stock Index ETF	+0.10%
Cross-up	IDV	iShares International Select Dividend ETF	+0.30%
Cross-up	VB	Vanguard Small-Cap Index ETF	+0.39%
Cross-up	VEA	Vanguard FTSE Developed Markets Index ETF	+0.41%
Cross-up	SPYV	S&P 500 Value ETF	+0.44%
Cross-up	VGK	Vanguard FTSE Europe Index ETF	+0.61%
Cross-up	XLY	Consumer Discretionary Select Sector	+1.08%
Cross-up	IQLT	iShares MSCI Intl Quality Factor ETF	+1.23%
Cross-up	RSP	Invesco S&P 500 Equal Weight ETF	+1.47%
Cross-up	ACWV	iShares MSCI Global Min Vol Factor ETF	+1.58%
Cross-down	MDYG	SPDR S&P 400 Mid Cap Growth ETF	-0.18%
Cross-down	SPYG	S&P 500 Growth ETF	-0.35%
Cross-down	XLK	Technology Select Sector	-1.00%
Cross-down	IYW	iShares U.S. Technology ETF	-1.01%
Cross-down	IWF	iShares Russell 1000 Growth ETF	-1.41%

Fixed Income: Price vs 20-day MA

Signal	Ticker	Name	20D perf
Cross-up	TLT	iShares 20+ Year Treasury Bond ETF	-0.10%
Cross-up	MUB	iShares National Muni Bond ETF	unch.
Cross-up	LQD	iShares iBoxx $ Investment Grade Corporate Bond ETF	+0.34%
Cross-up	EMB	iShares J.P. Morgan USD Emerging Markets Bond ETF	+0.46%
Cross-up	VCIT	Vanguard Intermediate-Term Corporate Bond Index ETF	+0.48%
Cross-up	IEF	iShares 7-10 Year Treasury Bond ETF	+0.64%
Cross-up	PFF	iShares Preferred and Income Securities ETF	+0.93%

Fixed Income vs AGG: Price Ratio vs 20-day MA

Signal	Ticker	Name	20D rel perf
Cross-up	TLT	iShares 20+ Year Treasury Bond ETF	-0.69%
Cross-down	VGIT	Vanguard Intermediate-Term Treasury Index ETF	unch.
Cross-down	IEI	iShares 3-7 Year Treasury Bond ETF	unch.
Cross-down	VCSH	Vanguard Short-Term Corporate Bond Index ETF	unch.
Cross-down	VTIP	Vanguard Short-Term Inflation-Protected Securities Index ETF	-0.27%

Specialty: Price vs 20-day MA

Signal	Ticker	Name	20D perf
Cross-down	DBMF	iMGP DBi Managed Futures Strategy ETF	-1.43%
Cross-down	MTUM	iShares MSCI USA Momentum Factor ETF	-2.66%
Cross-down	SMH	VanEck Semiconductor ETF	-4.43%

Specialty vs SPY: Price Ratio vs 20-day MA

Signal	Ticker	Name	20D rel perf
Cross-up	IBIT	iShares Bitcoin	+0.93%
Cross-up	ETHA	iShares Ethereum Trust ETF	+6.29%
Cross-down	MTUM	iShares MSCI USA Momentum Factor ETF	-5.40%

Commodities vs SPY: Price Ratio vs 20-day MA

Signal	Ticker	Name	20D rel perf
Cross-up	DBA	Invesco DB Agriculture	-2.61%

Romain Gandon
CEO, Quantlake

Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. Past performance is not indicative of future results.