The generals – the Invesco QQQ Trust (QQQ) – led from the front this past week, charging ahead with a 3.9% gain and breaking through to close at new all-time highs. Yet broader participation lagged, and price recently remained tethered inside last week’s range, observes Buff Dormeier, chief technical analyst at Kingsview Partners.
All major units advanced, yet the equal-weighted forces – like the Invesco S&P 500 Equal Weight ETF (RSP) – lagged their capital-weighted counterpart, managing only a 0.9% gain. As for the troops – the iShares Russell 2000 ETF (IWM) – they rose 2.8%. Yet they remained positioned within the previous week’s trading range as of Monday, still bounded by 225 resistance overhead and 212 support beneath.
For the week as a whole, 72% of flows were inflows, and an impressive 74% of Capital Weighted Volume was to the upside. The accumulated trends of Capital Weighted Volume and Capital Weighted Dollar Volume remain firmly above all-time highs, reinforcing the view that volume leadership is intact and extending well ahead of price.
Still, despite volume trends breaking new ground, the S&P 500 Index (^SPX) closed inside the previous week’s range. To confirm an outside breakout, the index must push convincingly above 6,427. A drop below 6,212 would instead mark a breakdown from the current outside bar formation.
Overall, the market’s elite forces have broken new ground, and volume is confirming their advance. The conditions are favorable for a follow-through, but a disciplined commander does not assume victory until the field is fully taken.
Investors should maintain alignment with volume-confirmed leadership while respecting key support levels as lines that must be defended. Tactical stops, prudent position sizing, and diversification remain essential in case the tide shifts unexpectedly.
