Research Excerpts

Top-Heavy SPY Helped Trigger Friday’s Collapse

Posted on: Saturday, September 19th, 2015

In a pre-opening note to Asbury subscribers on Thursday September 17th, we pointed out unusual asset flow activity in the S&P 500 SPDR (SPY) since Monday that resulted in a Jenga-like top heavy condition in the US broad market, making it vulnerable to — and helping to light the fuse for — Friday’s collapse.  The following is an excerpt from that note.


The green highlights in the chart below show that the total net assets in the S&P 500 SPDR (ETF) expanded by $4.1 billion or 2.4% on Wednesday, for a total expansion of  $16.6 billion or 10.3% since Friday September 11th.

0918-1

S&P 500 & S&P 500 SPDR Total Net Assets

This indicates that the market has quickly become top-heavy this week, as the red highlights show that over 10% of the total assets invested have been added at S&P 500 (SPX) 1948 or higher – which is Monday’s low.

This represents a pretty aggressive bet by the market that the Federal Reserve will leave interest rates unchanged this afternoon, a bet that will quickly put more than 10% of the assets invested in SPY into the red on a decline below SPX 1948.

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We have since updated these data, and their potential implications on next week’s US market direction, in our Friday Weekly Wrap-Up report which Asbury Research subscribers can view by logging into the Research Center.

Interested Investors can request a sample copy of Friday’s report by typing “Weekly Wrap-Up” in the Reason For Inquiry box from our Contact Us page.


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