NEWS You Can USE

THE INCREDIBLE SHRINKING VOLUME THAT DEFIES ECONOMIC LOGIC, or does it ?

All the classic literature, Fundamental or Technical Analysis,  points to the fact that in Bull Markets going up, volume expands, as the demand for the stock grows, and it is borne out time after time in classic markets.

   So,  we know that Households hold about 35% of all equity, but we also know that the trading is highly composed of Institutions, and as well we see Mutual Fund Withdrawals continue to expand.

Therefore it should puzzle us a little to see the Wilshire 5000 Index which includes most of the Capitalization across ALL U.S. Markets, continue to shrink in volume.  To me, it is a puzzle with several possible clues.

  Are Vigilante Individual’s sneaking “Market Orders”, driving the market up in their intensity of FEAR of not getting on-board?

Truthfully, I think that is not an explanation.

ARE HFT TRADERS DISTORTING PRICE ?  YES, I THINK SO BUT SINCE ONLY 1 ORDER PER HFT IS EXECUTED, I DON’T THINK THAT IS THE ANSWER TO THE “SHRINKING VOLUME” ISSUE.

CLEARLY I AM NOT THE FIRST ONE TO ADDRESS THIS ISSUE, BUT IT REMAINS FOR ME TO POINT OUT TWO LEGS OF AN OBVIOUS ANSWER:

  • INDIVIDUAL INVESTORS, LARGE AND SMALL ARE LEAVING THE EQUITY MARKET, probably for bond markets(won’t that be a hoot, when they realize they got in at the top?).
  • SOMEONE OR SOMETHING, IS  CONSISTENTLY GOOSING THE MARKET HIGHER, SUPPORTING IT AT CRITICAL LEVELS, IN A STEALTH MANNER, WITHOUT REGARD TO PROFIT, “aLa 5 RULES FOR SMACKDOWN”
  • I DON’T LIKE IT I HAVEN’T LIKED IT SINCE THE “GREENSPAN PUT” BACK IN 2006.
  •    It’s clear “THE MARKET”is being distorted and supported while the currency it is denominated in, is being depreciated as in:

    Currency we pay in, vs, the cost of goods

    FEELS LIKE JAPAN

The sad part here, is THE MARKET, as this mystery “MAN” is supporting, is just that.  THE MARKET, which should be good, but individual stocks are taken out beind the shed and beaten bloody for any reasons, without a reasonable chance to exit or even execute a stop before they are trapped.

These behaviours on the part of the “Mystery MAN: probably explain why investors, institutional and individual don’t feel they have even half a chance to get any capital appreciation without undue risk.

TWO POSSIBLE PATHS HAVE BECOME MY METHOD:

  • FIND a way to discriminate stealthily strong stocks from the crowd for Short to Intermediate Investing – that’s the Short end of the time picture.
  • DEFINE stocks with subtle yet consistent LONG TERM Strength and movements, which can be seen from a different and longer perspective.

You can find both on this website, and get a sample by request.

 

 

 

 

 

 

 

 

Denaliguide: I am Denali Guide, retired after   Alaska.

A self taught analyst / strategist, I enjoy sharing  years of technical market savvy, gathered over the years as an investor seeking a better way.

 

OUR PRINCIPLES at DGS:

  1. Treat everyone as you would wish to be treated
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  4. Have everything you need and nothing you don’t.

OUR MISSION STATEMENT:

Our mission : To provide our subscribers with the clearest, easiest to use, most timely selections they can use for their profit.
SIMPLE, FACTUAL and CONCISE.

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OUR THREE KEY QUALTIES:

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  • Simplicity. “Simplicity is the ultimate sophistication” Leonardo da  Vinci

This kinda summarizes how I think the “GURU” scene affects investors:

by Toby Keith. Click the Title below:
A Little Less Talk and a Lot More Action