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Market moves into Uptrend…still plagued by low trade volume

Yesterday the stock market had a mild follow through day, confirming an UPTREND.  However, I suggest you remain cautious.  As previously noted, trade volume remains weak on days when the market shows price improvement.  Read this as a red flag of warning- if institutional investors have strong convictions that this is a good market, why aren’t they purchasing more shares when they’re “on sale”?

[ See the below chart which illustrates S&P500 volume on Uptrend confirming follow through days- follow through volume has been week and average volume has declined since February.  The red bar signifies the breakout volume on the day the market changed direction and confirmed an uptrend was underway. ]

I believe it’s because this recovery continues to be tepid and the market rise has been driven mostly by the Fed’s Quantitative Easing policies…which are coming to an end.

The global economy is weak, geopolitical risk is high, US growth continues to be revised down.

Today Macy’s announced that they missed Q2 earnings and they reduced 2014 sales growth down to below 2%.  This is hard to believe (they have no shame) but they’re STILL blaming bad winter weather.

[ Just once it would be nice to have a financial report or an analyst ask the obvious-  If the weather was soooo cold, why didn’t Macy’s sell more coats, hats, wool socks, long underwear and boots?  Cold weather should have INCREASED their sales! ]

S&P500 Follow Through Volume 140814