Volume. I’m sure you’ve noticed that volume has been noticeably dropping off over the past couple of weeks. For the week ending 10/28, the $SPX traded 18.8 billion shares. For the week ending 11/4, the $SPX traded 17.3 billion shares. And this last week the $SPX traded 15 billion shares.
I don’t place as much weight on the importance of volume as I once did because volume is basically relative. As long as there are more buyers than sellers, then the markets will go up. Still, Friday’s volume for the $SPX of 2.6 billion shares on a +24pt day does make you wonder why there was an apparent lack of participation on such a mega day.
92% of Friday’s volume went into advancing issues. Since late August, we’ve had five other 90% + up volume days. The following day was either down slightly or flat and this would be my expectation for Monday. However, news may be the determining factor in Monday’s action.
$NYDNV closed at 55.37 on Friday, so this is showing that the markets are overbought.
$NYADV closed at 2596 which is also showing an overbought situation.
$NYAD, the daily reading, closed 2171 and so this too is showing an overbought situation.
But that’s about it. Things like Zweig Breadth Thrust are giving readings in the neutral range so no clues from ZBT or many of the other breadth indicators that I track.
Long term 60 minute chart of the Q’s. All’s well as long as they quit selling AAPL.
$SPX weekly chart. All but the 26MA on this chart is in an up trend so it does appear that that is the way the $SPX is headed. The potential bull flag that I mentioned a couple of weeks ago looks more like a minor up trend within the larger up trend. The bottom line is that this is a chart with a upward bias.
Chart courtesy of StockCharts.com
GL in the week ahead.