Coach Mark here.

We had one of the lowest volume days in the SPY in many years yesterday. “Nobody is home” were the tweets out there in investing land. “Never short a dull market” was the thought that ran through my head. Yesterday reminded me a lot of 2017 where we had several stretches of low volume/participation during that uptrend. Shorting the S&P was a terrible idea in 2017 but there were many bearish plays on stocks along the way.

2017 was a great trader’s market. Correlation between the S&P 500 and the average component was low in 2017. There were many bullish plays that did fantastic but there were also several bearish setups that worked out well. In low participation/volume markets it does not take much to move price. Technical setups both on the bearish and bullish side tend to work out in these environments and traders should be open to both sides of the equation in this type of environment.

With Nvidia reporting after the bell there is no doubt volume will pick up the next few days but if low volume environment returns, hit those technical setups on both the bullish and bearish side. You will come to appreciate the environment.

Have a fantastic Wednesday!

Semiconductors Weekly Chart (SMH)

One of the things to monitor in the coming days is the reaction of semiconductors to Nvidia’s earnings. Attempting to breakout ahead of earnings, there could be interesting setups in the space in the coming weeks.  

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