My Trading Licks

Markets gapped up at the open on Wednesday and gave traders a rush of something that’s been lacking in the indices for quite some time… Serious volume. Oh, there was plenty of volume on the downside as markets crumbled in January, but we haven’t seen across-the-board accumulation like today since 1/31, and before that you’d have to go back as far as the first trading day of this year.

Overall volume is also showing a growing trend so far in 2022 with shares on the NYSE trading at 4.7 billion shares daily on average. We’re still shy of the 5 billion average we had in 2020, however, compared to the decrease to about 4.4 billion shares in 2021, this market is definitely staring to gain interest from the big institutions once again.

So is the S&P 500 finally coming out of the woods? Well, as far as earnings go, Disney (DIS), Uber (UBER) and Chipotle (CMG) seem to think so – which is not surprising as who can imagine life now without any of them – but clear skies for the indices will depend on other economic forces as well, not to mention the fact that SPY now has one majorly large gap to fill.

TVO, our volume oscillator, is accelerating its pace and will likely break above zero soon, which will shift our long term portfolio into LONG mode, meaning that it’s good time to add to, or open, long term stock positions. It’s also possible that IO, our issues oscillator, will trigger a long signal soon, which means that the retail crowd, although typically late to the party after the big boys, is not too far behind. – MD

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