Big Money Index Is Finally Rising

And there’s reason to believe that’ll be the case in 2021. I’ll show you 2 reasons why I think stocks are setting up for more highs in the coming weeks and months.

First, we can see that the Big Money Index is starting to rise. As a reminder, the Big Money Index tracks big buying and selling in stocks. When the index rises, markets tend to head higher.

When it falls, more stocks are getting sold compared to those getting bought. Look how it’s started to ramp the last few days:

Many small-cap companies were holding the BMI back for well over a month. I discussed this last week, as I told how there’s likely value in the smaller stock space.

Well, many of those sellers have disappeared. And a cool way to see that is in our ETF Buys & Sells Chart. Below, the green bars are the number of ETFs getting bought with Big Money. The red bars are sells.

Look how Friday had a big green bar. This type of action is helping lift the BMI:

With the BMI ramping and ETFs seeing green action, that’s bullish in the short-term. But remember I said there were 2 reasons that pointed to higher market prices.

And the 2^nd data point is history. Below, I pulled September – December returns for the market (SPY ETF) going back 25 years. Yes, it tends to be very bullish:

It’s hard to bet against history and positive signs in the Big Money data.

Here’s the bottom line:

Small-cap stocks were weighing down the Big Money Index. Much of that selling looks to be behind us for now. With the BMI starting to rise, and the historically bullish last four months of the year starting soon, signs point to a bullish setup in the weeks and months ahead.

Disclosure: the author holds no position in SPY, QQQ, DIA, or IWM at the time of publication.

Learn more about the MAPsignals process here: www.mapsignals.com

Disclaimer