The markets campaign opened with strength but ended with attrition last week. The State Street SPDR S&P 500 ETF (SPY) declined 2%, reflecting pressure at the index level. The Invesco QQQ Trust (QQQ) fell 1.9%, while still holding relative leadership versus peers. Now, it’s put up or shut up time, writes Buff Dormeier, chief technical analyst at Kingsview Partners.
Under the surface, the data confirms distribution is gaining ground. Capital Weighted Volume finished slightly above average, yet the composition deteriorated. Upside Volume remained well below average while Downside Volume expanded above average, resulting in 69% of weekly Capital Weighted Volume and Dollar Volume flowing to the downside. This represents a meaningful shift in control of capital flows.
Invesco QQQ Trust (QQQ)
Breadth continues to weaken, too. The NYSE Advance Decline Line has broken trend and is approaching intermediate support, reflecting narrowing participation. Meanwhile, operating company breadth remains more resilient but is also losing altitude. The generals are no longer advancing with full support from the ranks.
The market battlefield has reached a critical decision point. If intermediate volume trends hold and support levels stabilize, the bulls retain a path to regroup and counterattack. If these levels fail, distribution is likely to accelerate as fewer units remain to carry the advance.
In this environment, discipline is essential. Traders should emphasize position sizing, respect for key support levels, and confirmation through volume before committing capital. Let volume lead and price confirm.
For now, the order stands. Hold the line where it matters or step aside. The market has entered its “put up or shut up” phase.
