Wall Street and a signal signal: excessive optimism?

Wall Street and a signal signal: excessive optimism?

It has long been evident that the market has been almost without investors interested in selling, enhancing the rally and the trend. However, some analysts warn that this phenomenon could be starting to change.

The vision of the conspicuous analysts of Wall Street realizes that the performance of the S&P 500 index, a reference of the New York and global bag, in the last 13 years reflects, in part, that Investors are amalgamated to their shareholdings and do not seem so predisposed to sell And so the actions continued to climb after the occasional adjustment. At present, it would seem that all the attention is in the balances of the companies, the tariff guerrillas and their “Deadline” on August 1, and even the dimes and diretes about the future of Jerome Powell, head of the Fed.

However, as Bárbara Kollmeyer, Marketwacht (MW), is something more interesting that is happening in the market: As investors have continued to ignore tariffs and economic concerns during the summer (boreal), it seems that sellers have also scarce. The data arises from the daily monitoring that Thrasher Analytics, Andrew Thrasher, whose research shows that The level of sale of shares has been touching dangerously low levels.

At the beginning of the month, Thrasher published a study “Declineing Volume has disappareted” and found little activity in the actions whose value is falling. The study revealed that, when you begin to see very little volume in downward shares, many capital sales are not seen, not even strong sales. “This is probably due to the perception that the entire approach focuses on buying and raising the shares,” said Thrasher to MW. Therefore, almost no action is going down, and those that do not register much volume, which can become an “sign of excessive optimism”, He added and sentenced that, at the ends, it becomes a kind of “up and down where there are too many people on one side, and simply cannot move.”

What should investors be attentive?

In a Thrasher chart it shows that, at the beginning of July, the volume of negotiation of the actions on decline fell to 39% of the total volume. But it happens that when that figure exceeded 42%, there were setbacks, although brief and fast, as a 7.5% drop in September 2020, one of 5% in 2019 and one of 5% in 2016. “The upward trend until 2024 never saw that proportion below 40%”he said in MW. However, more recently, that proportion has risen to 44%, which means that sellers could be beginning to appear, said Thrasher who said they were beginning to see a greater volume of falls in the actions, which coincides with many other amplitude data. He argued that they were starting to see less new maximums and less participation in this market in the last two weeks, in most of the shares.

Kollmeyer comments that Thrasher, who also helps to manage more than US $ 800 million for high -equity customers as portfolio manager at The Financial Enhancement Group, said that, although the stock market still looks “Structurally solid”it is difficult to see what will cause the next increase, due to “Unknown impact of additional tariff ads”. Ultimately, Thrasher said that, he pays special attention to prices action, he suggests that investors should also be attentive to an increase in inflation, since this will press the consumer and become a long -term negative factor. “We are observing inflation and labor market, but so far they are not entirely alarming.”he said.

Source: Ambito

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