Hey, Ross here:
Welcome back to a new trading week.
With more tariff headwinds facing the market this week, let’s look at a couple charts that show how both retail and institutional investors are acting.
Chart of the Day
This chart shows the cumulative buying of S&P 500 and Nasdaq 100 stocks by individual investors this year.
You can see the graph steadily rising till the beginning of May…
After which they both flatline – or even dip – indicating a pause in buying (remember this is cumulative, so a flat line means no net additions).
I’m not surprised by this.
Retail investors have been extremely jittery this year – despite all the new all-time highs.
The institutional side has been a bit more aggressive – but has been recently showing caution as well.
The NAAIM Exposure Index – which gauges how exposed the average active fund manager is to the US stock markets also took a dip from last week.
As I said last Friday, don’t be surprised if we see a short-term pullback.
But here’s the thing…
Don’t confuse a short-term pullback with falling risk appetite.
I explain more below.
P.S Stay one step ahead of the markets and stop missing out. Text the word “trade” to 87858 and get this newsletter delivered straight to your mobile.
Insight of the Day
The stock market can pull back – even as risk appetite increases.
Bitcoin has exploded to new all-time highs…
With Bitcoin ETFs seeing record inflows.
That is a clear-as-day indication of healthy, strong risk appetite.
The market may be pulling back a little – but risk appetite is actually increasing.
It seems paradoxical, but many things in trading are like this.
Here’s another example.
If you look beneath the surface of the market right now…
You’ll see certain sectors surging even as the broad market dips.
Institutional investors are pouring money into these sectors…
Even as their overall exposure to US stocks fall.
That’s an opportunity…
One most traders will miss, because they can’t wrap their heads around this paradox…
And are only able to see what’s on the surface.
Earlier this morning, I went live for a special strategy session where I dove deep into the markets…
Showing exactly what I’m seeing from a macro perspective, all the way down to specific sectors and stocks.
It was 100% education – and originally for members only.
But it was too good not to share with the wider community…
So as a special bonus, we’ll be releasing the replay later this evening.
Keep your eyes peeled for that.
Customer Story of the Day
“I have always been interested in the stock market. I’ve never felt a need to dive in until now.
I listened to many calls prior to purchasing my first product with TA. I have, albeit, a small amount of money to invest, but I’ve already learned so so so much from Ross.
His teaching style is excellent, and he is very good at making things clear and understandable.
Don’t hesitate to get in the game, you won’t regret it!! I am so glad I did!.”
Ross Givens
Editor, Stock Surge Daily
