Volume Analysis ‘Flash Market Update’ – 8.28.23

Despite ultimately closing below its mid-week peak, the S&P 500 experienced a modest uptick during the week, guided by the troops (NDX 100 index). The NDX 100 exhibited strength, concluding the week with a gain of 1.68%.  In contrast, the Dow Jones Industrials saw a decrease of 0.45% while the iShares Russell 2000 ETF (the “troops”) faced a slight decline of -0.35%.  The S&P 500 commenced the week with an opening value of 4380 and concluded slightly higher at 4406 by the close on Friday, marking a 0.82% increase for the week.

Although the S&P 500 saw overall growth, the market breadth painted a different picture.  The number of stocks reaching new 52-week highs shrank, mirroring a similar decline in the NYSE Advance-Decline Line.  Notably, for the first time in 3 weeks, a shift occurred in S&P 500 capital flows.  Last week showcased robust inflows of $53.8 billion in stark contrast to the $28.4 billion in capital outflows. 

Presently, the S&P 500 is trading inside its August 14th weekly range. The upside of that range, 4490, represents resistance, whereas the downside serves as support @ 4435.  A daily close above either of these points could suggest the next short-term direction of the S&P 500.  Monitoring a daily close beyond either of these points could offer insights into the potential short-term trajectory of the S&P 500.

Grace and peace my friends,

BUFF DORMEIER, CMT®

Updated: 8/28/2023

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