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Yesterday's Distribution Day

CharlesCharles
edited April 2013 in Fund Discussions
So, Flack has me sensitive to something called "Distribution Days." Days when market falls on heavy volume. If I have this right, yesterday's pull-back was strongest such day since 2011. Here's the bubble chart depiction since the very volatile days of 2008...a few months before Lehman collapsed. Note that the area of each bubble represents relative volume above or below its 200-day SMA.

image

Interesting also the high occurrence of empty bubbles (low volume days) since 2009, which I guess is indicative of the lack of respect for this bull market.

And what is significance of 6 May-10? The day the high-speed trading bots lost control...the flash crash.

Comments

  • AKAFlack
    Charles,

    First, it's me having had to rejoin under a slightly different user name.
    It's taken several days of trying to log back on the site.

    Your chart is very interesting. I wish I knew how to do this stuff.

    Why did you select the 200-day SMA of the volume?
    And where did you locate this volume average?

    Thanks
    Flack
  • CharlesCharles
    Reply to @AKAFlack: Hi man. Just a standard chart type in Excel. The data is from Yahoo Finance. Nothing precise about the 200-d SMA number. Thought it would be more interesting, and perhaps meaningful, to show daily volume in context of longer term momentum than say just day-to-day movement.
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