Just saying………

Below is a chart of the daily volume of shares traded on the New York Stock Exchange since the March 2009 S&P 500 low of 666 points until today, where the S&P 500 sits at 1,500 points.

A market that has advanced on declining volume. Just saying….

So what happens next?

If the market has risen handsomely in the face of so much worry (remember Greece, Portugal, Arab Spring, Chinese slowdowns, Japanese Debt, Iranian & North Korea nuclear threats, The Fiscal Cliff, Debt Ceiling’s etc etc.) on so little volume, then what happens if “normal” volume actually returns to this market.

Logic may not help you figure this out.

If notable, sustained volume returns to this market, it may not resemble selling pressure as you would logically assume. Logic may led you to believe that the market rose on declining volume thus it MUST fall when volume returns to normal or at least rises.

Imagine if increased volume was a new wave of buying volume? Those who sat on the sidelines citing every doomsday pundit for the past 4 years to justify their position, may suddenly have a Fear Of Missing Out (FOMO).

The FOMO effect could see markets rise swiftly leaving the “unadjusted” hanging when a change in trend does occur.

Markets are cruel, so my read is the equity markets see a small decline in the near term, only to get the bears excited followed by a surge in prices into June-August 2013, which should be fun to watch. Many investors are very good at buying high and selling low.

Bring back the volume – where are they High Frequency Traders, when you need them!

NYSE Volume Jan 2009- Jan 2013

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