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| THE
SITE OF TECHNICAL MARKET INDICATORS |
| Charts
of Interest |
| THE
"CROWD" GOES WILD!! |
| (October 10th, 2006) The Chart of Interest shows you the weekly short sales by the public, or the so called "crowd" or "herd" (dumb money), divided by total weekly NYSE volume, compared to the weekly short sales by NYSE members (smart money). NYSE members are all the well known Wall Street broker firms. They have the best brains and analysts working for them and the have tons of money as well. Short selling by the public has now hit levels like never before in recorded stock market history. It is therefore most unlikely that the market is even near a top, because the "crowd" has until now never beaten the Wall Street pros. (Chart of Dow Jones enclosed for comparison) |
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(October
10th, 2006) The Chart of Interest shows you the weekly short
sales by the public, or the so called "crowd" or "herd"
(dumb money), divided by total weekly NYSE volume, compared to the weekly
short sales by NYSE specialists (smart money). Specialists are responsible
for balancing incoming buy and sell orders and they must buy and sell
stock against the market trend to cushion temporary imbalances and avoid
unreasonable price variations - committing capital to add liquidity when
it is needed. If buy orders temporarily outpace sell orders in a specialist's
assigned stocks - or if sell orders outpace buy orders - the specialist
is required to use their firm's own capital to minimize the imbalance.
This is done by buying or selling against the trend of the market, until
a price is reached at which public supply and demand are once again in
balance. It is therefore no wonder that the specialist business is passed
on from one generation to the next; it is the most risk-free way to make
a lot of money in the financial markets. Short sales by NYSE specialists
are now at their lowest level since at least 1943, when reliable records
of the indicator were first compiled. Not even during the vicious 1973-1974
bear market we saw such low readings of this indicator and that's extremely
bullish. It would be the first time in market history that these guys
are wrong. (Chart of Dow Jones enclosed for comparison) |
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