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The Upcoming 'Wall of Worry' Resistance Line...

You often hear us talk about the Institutional Index of "core holdings" and their importance to the market. The market follows the direction of the "core holdings" due to the massiveness of capital and volume involved. The remaining part of the market cannot keep the market going up if Institutional investors decide to go into Distribution. (Currently, they remain in Accumulation.)

Today's chart show's a four year trending picture of what the Institutional Index has been doing. And today, I would like to specifically point out the "black" rising trend line. The Institutional index has not risen to that level yet, but the current bias is supporting the extra movement to that level.

The "black", rising resistance line shown is special on the Institutional index. Special, because historically, that particular line pattern has been associated with the market rising and the Press commenting on how the stock market had been "Climbing a Wall of Worry" ... terminology that you probably have not heard in a long time.

We are not there yet, but if we do see the Institutional Index crawl up just below that black resistance line, you will start hearing the Press using the "Climbing a Wall of Worry" terminology once again. In the past, it was not unusual to see the Institutional Index continue its up trend while hugging the bottom of the rising resistance line. (Chart reference: This chart is updated every morning on our paid subscriber sites and can be found as the first chart in Section 1 ... there are 5 Sections with charts posted daily.)

Institutional Index of Core Holdings

 

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