Definition of a Distribution Day in the Stock Market
I have been asked by many of my students the definition of a Distribution day in the Stock market. A Distribution day is a decline of at least 0.2% in higher volume. This signifies that the Institutional Big investors are “distributing” shares or in other words liquidating their positions. When we have more than 4 distribution days caution should be exercised. Currently we have 9 Distribution days. My model Andrew Abraham Buy is in cash currently and I do not have any long positions in the stock market.
We want to be in align with institutional investors not being in the opposite corner.
One needs to have a trading plan. The most important issue is to know where we are in the stock market cycle