Volume Analysis | Flash Update – 9.28.26

Generals Press the Advance While the Ranks Continue in Retreat

The bulls jumped out to a strong start on Monday, easily penetrating the prior week’s decision candle resistance. The move came with upside conviction, as 92% of S&P 500 Capital Weighted Volume traded to the upside, although total Capital Weighted Volume was only average on the day. The rest of the week largely traded within Monday’s wide range, suggesting the bulls won the opening skirmish, but did not fully overrun the battlefield.

For the week, S&P 500 Capital Weighted Volume was light, yet 67% of volume registered to the upside. Capital flows were average, but above average inflows accounted for 64% of the week’s total flows. This is a constructive message beneath the surface. Price did not explode higher, but the internal flow data leaned in favor of the bulls.

The bigger story since August has been the reinvigoration of the generals. Last week, we noted the improving volume profile in the Invesco QQQ Trust Series 1. This week, the generals surged 3.19%, while the remaining ranks slipped deeper into retreat. The generals kissed major resistance near 750 on Tuesday, where they were swiftly driven back on weaker volume. Still, they finished the week near the upper end of their range and appear positioned to retest that resistance line.

A breakout above 750 on heavy volume would return the generals firmly back into command. Until then, the generals have advanced, but the ridge has not yet been secured. In our framework, price alone does not declare victory. Price is testimony, but volume is the polygraph. As noted in the Second Half Volume Analysis Outlook, price tells us what investors have done, while volume tells us whether they have done it with conviction.

To the contrary, the troops, represented by the iShares Russell 2000 ETF IWM, are just barely hanging on above 280 support after declining -0.75% on the week. On Wednesday, the troops broke beneath 280, then rallied back to close the day higher. The reversal day was encouraging, but the line remains critical. While the generals are pressing toward new bullish territory, meanwhile the troops are on the beachhead slipping back toward a neutral or bearish theater.

The lieutenants, represented by the Invesco S&P 500 Equal Weight ETF RSP, also weakened, losing -0.56% on the week. The dividend brass commanders, represented by the Schwab U.S. Dividend Equity ETF SCHD, fell -1.40%. Both units remain above critical support, but neither is currently helping the generals carry the field. The belly of the market is not broken, but it has lost momentum.

This is the key tension in the campaign. The generals have resumed leadership, but the broader ranks are not advancing with them. This is not yet the army disappearing, but it is a warning that the command structure is narrowing again. A healthier advance would have the generals, troops, lieutenants, and brass commanders all marching in formation. Structure is important as market regimes mature.

The NYSE Advance Decline Line completed the weakness in the broader units, extending its southward retreat after breaking trend the prior week and closing near its weekly low. This remains one of the most important areas to monitor. Breadth was the early bright spot of  the 2026 broadening theme, and the Outlook noted that the market had been evolving from And Then There Were None toward And Then There Were Some, with more stocks participating in the advance. That progress is now being contested.

The brightest and most competent leading indicators remain the accumulated trends of Capital Weighted Volume and Capital Weighted Dollar Volume. Both continued to advance, breaking out to new all-time highs for several consecutive weeks. This is important. While the broader ranks have weakened, the supply lines have not broken. In fact, they have strengthened. That suggests institutions have not yet given in but remain strong participants. The current field report suggests capital flows remain supportive, even as breadth and broader participation require attention.

The rate front is becoming a greater battlefield concern. The yield on the 10-year Treasury has now exceeded 5%, breaking above August 2023 highs. Higher rates may finally be impacting the troops and the broader healthy rotation theme. Small caps, equal weight equities, and dividend stocks often feel the pressure when rates rise, while high growth and technology can remain more resilient if investors continue to pay for growth scarcity. This helps explain why the generals are advancing while the broader regiments weakened.

That also fits the current transition tape described in the Outlook. This is not a simple bull or bear environment. It is a market of dispersion, where sector leadership changes quickly, correlations fall, and the index may hide more than it reveals. The practical question is not merely whether the S&P 500 is up or down, but where participation is improving, where volume is confirming, and where price may be running ahead of sponsorship.

After rebounding last week, both gold and silver gave back much of their gains but traded inside last week’s range. The pullback may be tied to dollar strength. As gold and silver meet short-term support, the U.S. Dollar Index is now closing in on resistance near 102. The commodity scouts have not abandoned the field but are seemingly stuck in a tight range.

Oil and energy remain important as well. The war, Hormuz negotiations, and higher rate environment all keep the energy front tactically relevant. In the Outlook, technology and energy were described as a yin and yang market, often moving in opposing directions as war pressure, peace talk optimism, and growth leadership rotate. This week, that relationship again deserves attention as technology (XLK) regained command up 3.52% while energy (XLE) weakened -3.53% despite brent crude closing flat on the week.

Overall, this week presented a mixed but important message. The generals pressed the advance. Capital Weighted Volume and Capital Weighted Dollar Volume continued to break out. Capital flows favored the upside. Yet the troops, lieutenants, brass commanders, and breadth all weakened. The supply lines are strong, but the ranks are barely hanging in.

The bulls still hold the larger field, but command is narrowing. For the broadening campaign to regain strength, the iShares Russell 2000 ETF needs to hold 280, the Invesco S&P 500 Equal Weight ETF and Schwab U.S. Dividend Equity ETF need to stabilize, and the NYSE Advance Decline Line needs to regain its footing. If those units rejoin the generals, the advance could mature into a healthier formation. If they fail, the market risks returning to a narrow, generals-only campaign.

Risk Command

This remains a market for disciplined participation, not blind pursuit. The positive evidence is clear: Capital Weighted Volume and Capital Weighted Dollar Volume are breaking to new highs, capital flows remain supportive, and the generals are pressing resistance. The caution is equally clear: breadth has weakened, the troops are testing 280, the lieutenants and brass commanders have retreated, and rates are applying pressure to the broader ranks.

The Invesco QQQ Trust Series 1 needs to break and hold above 750 with strong volume to reclaim full command. The iShares Russell 2000 ETF must defend 280. The Invesco S&P 500 Equal Weight ETF and the Schwab U.S. Dividend Equity ETF need to hold critical support and stabilize. The S&P 500 must continue respecting support while pushing through resistance with volume confirmation.

If volume and capital flows remain strong while breadth stabilizes, the bulls may regain a broader offensive posture. If breadth continues to deteriorate and the troops lose support, defensive positioning should take priority over prediction. If both scenarios materialize it could appear good in the short and intermediate term but could also end tragically.

As for now, the generals are pressing the advance while the ranks continue in retreat. The supply lines are strong, but the formation is uneven. In markets as in war, victory is not declared by one mission alone. Our goal is to defend critical ground, follow the flow of capital, and manage risk before it manages us.

Grace and peace,

BUFF DORMEIER, CMT

Updated: 9/28/2026. Historical references do not assume that any prior market behavior will be duplicated. Past performance does not indicate future results. This material has been prepared by Kingsview Wealth Management, LLC. It is not, and should not, be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate their ability to invest for the long term. Investment advisory services offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser.