Correction Sooner Or Later

More distribution, look out below...
More distribution, look out below...

Yep, that’s distribution for Tuesday, market’s just a little more likely to sell off in coming sessions now.

For those who have no idea what we’re talking about, whenever volume comes in higher than the previous session on a down day it tells us institutions are in sell mode.

Of course we have no idea how long the selling might last, but it gives us an indication that it’s what’s in style now.

After the market’s huge run up since March we’re going to get a correction sooner or later…

What Tells A Top

Another dumper...
Another dumper...

We’re still believers this pullback will continue.

It’s important to watch volume. If it dries up, like it did in the last pullback, it’s a sign that sellers aren’t that serious and may lose their steam.

But if sell-volume increase it would indicate they’re serious. A few distribution days, where volume on a down day exceeds the previous day, might even be telling of a top…

No Dominance

Another year-high!
Another year-high!

Beware the market that moves little on high-volume.

It’s a grinding between buyers and sellers with no grease to indicate a clear dominance.

As we mentioned in our weekly market analysis we’re expecting some heavy dumping to go on this week or next week.

It may come at anytime.

And of course it may never come…

The Unwinding


Now that summer’s over we’re expecting to see volume pick up the pace with trading desks full manned.

Tuesday’s Accumulation of shares, as evident by strong rallying with volume above the previous trading day, would give one the impression that buying will remain en vogue.

But beware the head fake.

Market movers love shaking out weak-handed shorts.

We might see further advances until the pain is too much, causing short sellers to unwind.

More Than A 10% Correction?


Volume was much lighter on the heels of Monday’s heavy selling.

We’re expecting volume to remain light for the rest of the week into the three-day weekend.

The uptrend has been dented.

Our bias was one of caution for buyers coming into this week.

We still think more of a correction is likely.

We’ll change our bias if heavy selling becomes more of a trend, which would suggest something more than a 10% correction is in the cards.

Pushing The Bull Off Its Path


Major selling Tuesday weighs heavy to the bearish bias for the coming month.

It’s been a very difficult market to short. Perhaps this it the final blow to push the Bull off its path.

We’re going to see how long and deep it might go by watching our price and volume clues.

We’ll need a clear pattern of selling from institutions before changing our bias from Buyer’s Caution.