As the stock market’s sentiment relief rally has labored on, volume has diverged
It’s not usually a good sign when an index, ETF or individual equity rises on diminishing volume. That implies fading conviction among casino patrons.
SPY sees diminishing volume.
DIA sees diminishing volume.
SMH sees diminishing volume.
QQQ sees diminishing volume.
IWM sees diminishing volume.
Conclusion
The US stock market has risen on volume that has been lessening for all of November. I still think chances are they put on a festive rally into Q1, but the seasonal got started a little early. That is possibly at the behest of the post mid-term election cycle, which we noted ahead of time to be a positive underpinning, and definitely because of previously over-bearish sentiment that no longer is, which we also noted to be at an extreme over-bearish level in October.
Oh and they’ve all got gaps down toward the respective 50 day moving averages, with the exception of QQQ, which has a gap well below its SMA 50. What could go wrong?
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