Institutional Selling

[notouch]

I remember the postman delivered my mail early the day before the crash. Does this mean the market will crash every time the postman delivers my mail early? There's a saying in my country "hard cases make bad law". I think trying to draw conclusions based on things that happened before a freak 500 point crash is not going to help your trading.

[Soultrader]

	Quote:	notouch
	I remember the postman delivered my mail early the day before the crash. Does this mean the market will crash every time the postman delivers my mail early? There's a saying in my country "hard cases make bad law". I think trying to draw conclusions based on things that happened before a freak 500 point crash is not going to help your trading.

You cant take one piece of information in the markets and conclude. In this case, the Insititutional Holdings Index showed a consolidation prior to the correction on Feb 27. You combine that with the lower volume rallies and higher volume selloffs on the index futures. This information would of showed clear warning signals for longer term and short term traders and would of helped any trader from establishing a long position if he was aware of this. I personally tried to short the markets and was looking into options a few days before the correction. Although I did not get in, I have a few friends in Tokyo who got hammered on that correction.

If the information provided does not make any sense to a trader, why bother using it? If it helps, I am sure the information will be of tremendous help to the trader. Traders make money by being aware and selling it to those who are less aware.

[notouch]

Price and volume on the index futures and indices themselves gave us all the information we needed to know. I can't see how adding another 45 stocks to the DJIA is going to help us spot institutional selling.