So it's broken record time for me. You know I have to complain about the lack of volume over these last few sessions. Sure, the price action has been great but I just can't shake the feeling that I shouldn't trust this rally due to the relatively light volume. The Dow was able to break to a new 52-week high today and the S&P 500 isn't far away from that same feat. I'm a little skeptical that the S&P will be able to hold new highs but stranger things have happened.
The table's looking much better...
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Up | Up | Up |
| Intermediate | Up(+) | Up | Lat(+) |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I'm simply using the indices' relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
Trader Mike:
I share your sentiments and question the extent of this rally as well. The DJT did not confirm today's DJI new high, and that put the dow theory in play once again. Having non-confirmation from broader market indices such as SP500 and NYA further cast doubts on this upward move.
smtrader
I'm also skeptical of this rally but I've noticed the rally in October didn't really have much volume to it and still managed to push up to create a new high.
i could'nt agree with you more guys...
The lack of volume has been misleading since March though hasn't it ?
Dave,
Volume hasn't been great for much of the advance off the March low but a lot of that was just typical summer volume. What's happened the last few weeks though is different. Volume has been strong on down days and light(er) on up days.
"What's happened the last few weeks though is different. Volume has been strong on down days and light(er) on up days." That has been absolutely true, but still misleading.
IF one had paid too much attention to IWM/SMH's poor relative performance the past week+ one would have completely misread the mkt.
I think that we may be in a period (don't know for how long) when mkt anomalies may persist for longer than expected. We may be in a period when the mkt "wrong-foots" us for awhile. Every trader knows, or should know, that mkt anomalies don't matter UNTIL THEY DO.
Need to agree with Dave here, focusing on volume is too much IBD (one step behind) group think. Need to toss 'the volume problem' out as Alan Farley has discussed earlier this year -- machine driven market does not give a fig about volume.
In this case it shows how strong trend is despite the volume.
Really not surprising, since the SPX failed to break down under the rule of 4 pattern.
Today's failed b/o by the spooz stalled the bulls, and placed price back into the 1080-1100 channel. A pullback to 1080 would be a needed breather.
Mike,
Was wondering if you can recommend any swing blogs for me to check out. As much as I like the cut and dry of day trading, work and school schedule is not allowing me to really day trade.
Or if you have any previous links, since I think you've swing traded before.
Thanks.
The last bear´s round had indeed an uncommon increased volume, what left in the air a sort of bear rehearsal (aka as ´testing the enemy´s (bulls) strength´) for a possible new attempt soon.
But as Mark Douglas quoted: ´Remember that people's beliefs don't
change easily unless they are extremely disappointed.´, which means that a real bearish effort gonna be needed to change this 8 months bullish force.
Regarding the whole volume issue since March, we´ve been dealing with another volume average due to these new crise´s criterias that the market was put through.