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Friday, January 18, 2008


volume surge

volume through 1:30 is running wild -- 3.6mm shares on the NYSE, another 16% over the pace of the two previous heavy-volume days.

one point to make about volume: a great deal is made of the balance of volume, whether it comes on the uptick or downtick, and rightfully so. but one thing that often goes unstated in market declines is that someone is buying all this stuff. volume surges indicate huge selling, it's true -- but it also indicates huge buying at discounted prices.

here's a link to a chart of NYSE total volume, with 10ema plotted with the 50sma, and the s&p beneath. note how big spikes in the shorter average coincide with market bottoms -- but note also how large contractions in the 10ema (ignoring the annual holiday drop) tend to precede weakness.

the fact of the moment is that the 10ema of NYSE volume is reaching up to relatively high levels. just another point to consider.


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