Volume Analysis | Flash Market Update – 8.26.22
CHIEF TECHNICAL ANALYST, BUFF DORMEIER, CMTⓇ
In review, two weeks ago 8/15 we noted capital weighted volume was meeting critical resistance and the outcome of this battleline could determine the near and intermediate state of the market by stating “Capital Weighted Volume is also on the cusp of breaking resistance….Overall, price and volume are at crucial inflection points. Their outcomes, whether to breakthrough or retrace, could be viewed as telling for the current health and future direction of the markets both near and intermediate term.”
Last week 8/22 we noted the outcome of that crucial pivot point saying, “Capital Weighted Volume, which was on the cusp of breaking into bullish territory, hit resistance and sold-off.”
This past week the follow through accelerated in a big way as the market continued its bounce off resistance. Downside Capital Weighted Dollar Volume was heavy, particularly on Friday. As a result, short-term Capital Weighted Dollar Volume has now broken below trend, once again joining the intermediate term trend of capital flows downwards. Next support on the S&P 500 is 4000 and then 3900. Correspondingly, Capital Weighted S&P 500 Volume support is 339 and 331.
We will closely monitor these levels as these indicators may once again provide foresight into the health and state of the equity markets.
Grace and peace my friends,
BUFF DORMEIER, CMT®
Chief Technical Analyst | Kingsview Partners
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