Investors Shift From the DJIA and S&P 500 to the Nasdaq and Russell?

NEW YORK (TheStreet) -- The stock market finished the week where it begin. The DJIA and the S&P 500 continued to lead the way higher, although up just fractionally on the week. The DJIA closed up 0.004% for the week at 16583.34 and the S&P 500 index closed up 0.001% at 1878.48. All in all, a flat week for those indexes.

The real show this week was put in by the Nasdaq and the Russell 2000. The Nasdaq closed the trading week down 1.23% at 4071.87 and the Russell 2000 closed down 2% on the week at 1107.22.

Thus, we continue to have that two-tiered market I've written about for the past three months. How long can this trend continue?

This stock market continues to warn traders and investors to be extremely cautious. Trading this stock market in 2014 has become a very challenging. There is absolutely no common theme that traders or investors can be comfortable with.

The whipsaw trading action from day to day is causing many traders and investors to stay on the sidelines. The trading volume on a daily basis is confirming that fact. The S&P 500 Trust Series ETF (SPY) on Friday closed with volume of 82.4 million shares.

Friday saw the Nasdaq and the Russell 2000 indexes in the red. That gave boththose indexes an oversold signal according to my algorithm process, and followed with an intraday turn to the upside.

The DJIA and the S&P 500 saw no such oversold signal. We may indeed begin to see a rotation from the larger cap stocks into the small cap stocks next week.

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