Tech Bulls Are Trapped

A failed break out occurs when a price moves through an identified level of resistance but does not have enough momentum to maintain its direction. Since the validity of the breakout is compromised and the profit potential significantly decreases, many traders feel trapped and tend to close their positions fueling new waves of liquidation.

Trading Stocks With Unusual Volume

Traders watch for unusual volume stocks because they are often accompanied by large price movements. Increased volume flows are correlated with volatility. A heightened volume indicates something is going on today and that the stock is “in play”. A stock moving up on unusually high volume typically signifies an outsized demand to own the stock.

Transports Continue To Lag: Should We Be Worried?

Although the broader market is still flirting with records, the transport sector has struggled to recover lost ground—a potentially ominous sign for investors who believe transports need to rebound for the market to break higher. However, the last 10 years provide evidence that the bearish divergence between Transports and S&P500 does not necessary lead to market crashes.