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Institutional Accumulation Level Lessens as the Market Moves Higher

"I hope this doesn't become one of those Deja Vu moments down the road."

What are we referring to?

We are referring to the Negative Divergence that is starting to show up on our Accumulation/Distribution chart for Institutional Investors.

If you look at today's chart, you can see how there was a continuing, negative divergence between the NYA Index and Institutional Accumulation levels during the October to March time frame.

As the market kept moving higher and higher, the amount of equity holdings held by Institutional Investors lessened to the point where they ended up going into a double dip Distribution from April to May.

We bring this up because Institutional Accumulation is showing a lesser Accumulation level as the market is moving higher.

The last Divergence occurrence took 5 months before the market couldn't hold itself up on its own. Assuming this negative divergence continues, the question now is how long will it take for a similar scenario?

NYA (New York Stock Exchange Index)

 

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