Intermediate stock cycle is ripe for pullback

Weekly Review: But will buyers buckle?

The reasons why there has been marked deterioration in market volume can debated, but probably the biggest cause is a general lack of investor confidence compared to previous rallies when investors were feeling optimistic. The market declines from 2000 to 2002 and then the second worst decline in stock market history from the fall of 2007 to early 2009 hurt a lot of investors badly. History will clarify, but for now it continues to look as it the uptrend that has been underway for more than five months has been fuelled more by professional investors than by the general public that participated to a very large extent in the great bull market that peaked in 2000. Those 2000 levels have generally remained an impediment to strength each time they have been re-approached.

Daily S & P 500 Index with Cumulative Volume

Weekly S & P 500 Index with Cumulative Volume

The reasons why there has been marked deterioration in market volume can debated, but probably the biggest cause is a general lack of investor confidence compared to previous rallies when investors were feeling optimistic. The market declines from 2000 to 2002 and then the second worst decline in stock market history from the fall of 2007 to early 2009 hurt a lot of investors badly. History will clarify, but for now it continues to look as it the uptrend that has been underway for more than five months has been fuelled more by professional investors than by the general public that participated to a very large extent in the great bull market that peaked in 2000. Those 2000 levels have generally remained an impediment to strength each time they have been re-approached.

<< Page 2 of 5 >>
Comments
comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome