Since August, when volume was averaging less than 2billion shares a, average volume on $SPX has been around 2.4billion shares. However, on Decmeber 5th, $SPX traded 3.2billion shares and on Tuesday $SPX traded2.8billion shares. Today $SPX traded 2.7billion shares. I don’t know what this means but it could mean that we’re starting to see distribution. If this is the case, then it’s falling so far under the radar that the $TRIN isn’t picking up on it. I could be totally wrong on this but I am watching it.
Two big reversal days have left us with turning point or exhaustion candles. I’m not sure what kind of candle we got today. Could be a gravestone doji. Regardless, it is not the kind of candle that bulls want to see because it indicates that sellers were sitting on the sidelines for a long time today and then they went into action and sold that huge spike that came after the Fed announcement. I believe this is just a hint of things to come as a pull back or consolidation seems to be brewing but without confirmation what we saw yesterday and today is nothing more than good old fashioned profit taking. Confirmation would begin first with a close below today’s low of 1426.76 and secondly with a close below Tuesday’s low of 1418.55. We really ought to see the first part of this confirmation tomorrow.
GL & be careful.