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Tackle Today: Of Flies and Elephants

March 23, 2021

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Follow the Elephants


The Wall Street jungle hosts a variety of animals. Retail traders like you and me are the flies. We’re small, quick, and make little impact on the shape of the forest. Institutions are the elephants. They’re massive, slow, and can move darn near anything they want. Many a distracted fly has been smashed by their heavy footsteps.

You don’t always know where they’re going ahead of time. But once they show up, everybody knows it. This is one of the advantages of technical analysis. Charts reveal elephants’ footprints in the volume indicator.

Low volume days are those dominated by flies. High volume days are those dominated by elephants. The former is noise; the latter is signal.

We’ll talk more about the difference between up days and down days with high volume in our next few messages. For today, let’s make sure you understand what an “institution” is.

Think of them as big money. Usually they are stewards of capital, not individuals. Mutual funds, hedge funds, pension funds, endowments, and banks all qualify as institutions. These are firms that manage billions, and sometimes trillions of dollars.

Tomorrow, we’ll show how to identify if the elephants are buying or selling.


Chart of the Day

The VolumeAvg Indicator

ThinkorSwim has an indicator called “VolumeAvg.” By default, it plots the 50-day moving average of volume as a line. When a volume bar goes above the line, it’s officially a “high volume” day.

Video of the Day

Onboarding with Coach Frank

If you are new to Tackle Trading and want to see what it is all about, check out Coach Frank’s onboarding class from last night. 

Today’s line up

Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

The Coaches Show 8:30 PM EST

This is our weekly MasterMind group. Join the coaches tonight, 8:30pm EST to discuss the markets and help you prepare for the week.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.

Tackle Trading: Financial Freedom is a Journey. Sign up now for a 15-day free trial.

Financial freedom is a journey

The Tackle Today series is brought to you by Tackle Trading.

Sign up now and gain unfettered access to all of the quality content and powerful Scouting Reports that our Pro Members enjoy for 15-days absolutely free with no strings attached and let us show you what your trading has been missing.

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