SPY Assets Zooming Higher

During the post-election stock market rally, there has been a huge push into ETFs, and especially into SPY. It is the largest of the ETFs tied to the SP500 Index. It is normal to see fluctuations over time, with total shares outstanding rising and falling as prices do the same.
This is a normal function of investor sentiment. Rising prices get people more bullish, and so they pile into the market. Falling prices scare people away, and they sell. The sponsoring firm of SPY, State Street, responds to that changing demand by issuing or redeeming shares in exchange for cash or the underlying stocks, in order to keep the share price close to the net asset value (NAV).
Listen to Strong Dollar vs. Market Reflation
Generally speaking, when there is a huge surge of buying into SPY that pushes the shares outstanding number up above the upper 50-1 Bollinger Band, that can be a sign of a meaningful top for the overall stock market. The corresponding point can be made about dips below the lower band marking price bottoms.

This post was published at FinancialSense on 12/23/2016.