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Showing posts from May, 2021

A Potential Short-Sell Opportunity

In my previous post, the S&P 500 was at all-time-highs before dropping to almost -1.5% intraday as of this post. I highlighted how market participants, particularly those with superior information, were positioning for a moderate pullback in the short term. This post will explain the potential opportunity resulting from this pullback.  Market Breadth I would first like to mention a simple, yet power multi-factor model that incorporates price, volume, and volatility. As of today's close, the SPY's (an ETF that tracks the S&P 500 index) volume on today's poor performance (SPY rebounded from nearly -1.4% to -0.62%) accelerated against its previous trading day, 5 day volume average, 15 day volume average, 30 day volume average, as well as the 90 day volume average by +47.72%, +50.32%, +44.40%, +30.14%, and +29.69%, respectively, with the VIX index climbing by +6.39% to 19.48. This is what you do not want to see as a bullish investor with respect to volume by market part