Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
In all the old school technical analysis screed, volume should accompany price movement. Especially to the upside. However anyone subscribing to that view will be absent in this year’s rally and indeed much of the rally of the past few years. We have a new paradigm market where volume can whither, yet prices can continue to levitate. Another reason many mistrust the market nowadays – that simply is not how it used to work for decades on end.
Via WSJ Marketbeat:
- Through Feb 21., 18.9 billion shares of S&P 500-component shares have traded since the start of the year, a tumble of more than 20% from the same period last year, Deutsche Bank says.
- And this year’s volume is less than half of the 48.5 billion shares traded during the respective period in 2008. (please note, in early 2008 we were not in the heart of the crisis, so that is not an excuse… there had been some selling in latter 2007 but “subprime was contained” and commodity stocks were still rocking and rolling)
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