Volume Analysis | Flash Market Update 2.21.23

The stock market has fallen for the second straight week while capital inflows continue to increase. At the current pace, if capital flows were to just hold (not go down) for another few weeks or so, the S&P 500 may enter a Volume Analysis Bull market.

Although the S&P 500 is not advancing, it still holds above 4000 support, represented by the apex of the former Wedge. Meanwhile, the Advance-Decline is also holding above recent lows. Although fewer stocks are making New Highs, the rate of decline does not appear to be too concerning considering the recent surge.

Formerly, the stock market seemed to be craving the sugar high of easy money. Yet, recent economic data is damaging those hopes. It is impressive how well the market is shaking off this data. These recent reactions provide some optimism there may be more to this rally than the expectation of easy monetary policy.

Grace and peace my friends,

BUFF DORMEIER, CMT®

Updated: 2/21/23

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