With this week's chart, we check in with the "big money" again... and it's not pretty.
This summer, we noted several times how a stock rally requires a large and continuous flow of cash from "big money" investors that control hedge funds, mutual funds, and insurance funds. Only with their "yes" votes can a market remain healthy and strong.
At the bottom of this week's chart, you'll notice a panel with lots of black and red bars. These bars represent trading volume on the large S&P 500 fund (SPY). This is the most widely traded ETF in the country. Black bars represent trading volume on advancing days, red bars represent trading volume on declining days. The taller the bar, the greater the buying or selling "power" on that day.
As you can see, buying power slowly dried up during the summer. This was partly due to an expected seasonal lull. But in the last two weeks, the market has declined on some of the highest volume in half a year. The big money is back... and it's selling. Traders: mind your trailing stops!
This summer, we noted several times how a stock rally requires a large and continuous flow of cash from "big money" investors that control hedge funds, mutual funds, and insurance funds. Only with their "yes" votes can a market remain healthy and strong.
At the bottom of this week's chart, you'll notice a panel with lots of black and red bars. These bars represent trading volume on the large S&P 500 fund (SPY). This is the most widely traded ETF in the country. Black bars represent trading volume on advancing days, red bars represent trading volume on declining days. The taller the bar, the greater the buying or selling "power" on that day.
As you can see, buying power slowly dried up during the summer. This was partly due to an expected seasonal lull. But in the last two weeks, the market has declined on some of the highest volume in half a year. The big money is back... and it's selling. Traders: mind your trailing stops!
No comments:
Post a Comment