Watch the Block Trades
While the S&P 500 ETF (SPY) has inched towards multi-year highs, block money flow -- a gauge of net institutional buying and selling activity -- has fallen off a cliff since mid-January , suggesting the U.S. equity market is on shaky ground.
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click for larger chart
Source: Mike Panzner, Rabo Securities USA
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I would add that unless institutions come crashing back in, this is yet another data point that confirms the topping process . . .
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UPDATE: March 17, 2006 5:42am
Its not the raw fall off in block trades that is revealing, but rather, the divergence versus the market direction that is significant.
Why? Block trades may reveal what is driving the market in a given rally. Is it Institutional Buying, which tends to be measured and longer lasting as buyers scale in over time. Or, is it retail investors?
Institutional buyers tend to be part of longer lasting trends . . .
Thursday, March 16, 2006 | 07:30 PM | Permalink
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» Block Trades in SPY from Investing Intelligently
Watch the Block Trades from the Big Picture shows a chart of block money flow, a gauge of net institutional buying and selling activity in the SP 500 ETF, SPY. He says this suggests suggesting the U.S. equity ma... [Read More]
Tracked on Mar 17, 2006 4:37:50 AM
Comments
It appears to have fallen off the same cliff last year around this time, though.
Thanks for the data, nevertheless.
Posted by: wcw | Mar 16, 2006 7:53:04 PM
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