Money Inflow Update for January 17th. ….
We wrote about this last week, ( StockTiming.com Standard Update) but it is important enough to do an “Update” on Liquidity Inflow levels in the market and where they stood last Friday.
Jesse Livermore stated a very simple concept back in the 1930′s. He said that the market was all about money flows. If the money flowing into the market was net positive, then the market would move higher … and, if the money flowing out of the market was net negative, then the market would move lower.
So, let’s look at out Long Term Liquidity chart again today. As of the close last Friday, the Inflowing Liquidity levels were in low Expansion territory and just beginning to show a break above its resistance line.
Bottom line: The Inflowing Liquidity levels were positive, in lower Expansion territory, and just broke above its resistance line.
However, there is a cautionary negative to the indicator action that occurred last week. Liquidity inflows brokeabove the resistance line last Tuesday, however the indicator struggled and didn’t go up very much during the week.
At the close on Friday, the Inflowing Liquidity levels dropped to a level that was slightly below Wednesday’s level which was the previous low for last week. It was so slight that we will call it a tie which will make this week a very important week.
What should one conclude?
… That there was a positive bias to the market because Inflowing Liquidity levels were positive and above the resistance line.
However, the same time, Inflowing Liquidity stalled after the breakout, so Thursday’s high level for the week will now have to be tested. A rise above it would indicate the continuation of an up trend for Inflowing Liquidity which would be market positive.
If Inflowing Liquidity were to fall below January 6′s level during the week, then the current up trend will be in jeopardy of moving to a Liquidity Out-flowing condition which would be market negative.
So, this will be an important week because investors will be voting with their Dollars relative to the market’s next direction. (FYI: Daily Inflowing Liquidity levels can be found in Section 4, Charts 8-1, 8-2, and 8-3 of the Standard subscriber website.)
