The number of large block orders plunged today as the S&P 500 approached its 2872.87 all-time high from January 2018. There just wasn’t a lot of large players buying stocks today.

The PPI is coming out tomorrow and then we have the CPI hitting Friday.

PPI and CPI chart

The PPI looks horrible and eventually that’s going to translate into a faster rising CPI.

Trade wars are pushing the PPI higher which will eventually trickle down to consumers.

Worse, fewer and fewer stocks are participating in the uptrend over the last 2 months. Since June, the number of Nasdaq stocks hitting 52 week highs has formed a huge negative divergence to the Nasdaq Composite Index.

Nasdaq market breadth shows fewer stocks participating in the upward move

That’s a bad signal of weakening market breadth.

Another ominous sign is the elevated Equity Put/Call Ratio:

Equity Put Call Ratio is elevated

Put hedging (insurance against a downturn) continues to be at elevated levels. The market has gone up while the amount of puts relative to calls has gone up. That’s not something that can last for too long. Either the level of put buying is going to come down, or the market will come down.

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