Simple Technical Analysis of the Volume Indicators on the S&P 600 Index Chart

The S&P Small Cap 600 Index (traded under the SML symbol), together with the S&P 500, S&P 100 and S&P 400 indexes, belongs to the most popular of Standard & Poor's group of indexes. 600 Small Cap domestic stocks (public companies) are listed in this index.

Chart 1: S&P 600 index charts with simple technical analysis of volume surges.

Volume and price should always be analyzed together. In the chart above you can see how volume can reveal important information about the trading actions of professional investors. The relationship between the price and the Volume Moving Average (VMA) is one of the most important factors in technical analysis. In the example above, the price of the S&P 600 index has been declining for two days. This down-trend was dominant until the Volume MA moved up strongly, signalling that professional investors had started to buy from bearish traders who were satisfying their selling orders. Once volume has started to decline and the price has stopped its decline, it might be the safest point to enter a long trade ("Buy" point). When the S&P 600 price stopped to decline and you may see the decline in volume after big volume surge it could be interpreted as the professional bullish traders has completely took over the bearish traders and from that moment the odds of reversal up are quite big.

In the table below you will see how one of our exclusive institutional investors used the volume signal to maximize profits by trading S&P 600 index derivatives:

Table 1: The return that could be achieved by following
the volume signal on the S&P 600 chart above

Below are some of the S&P 600 derivatives which can be used to trade the volume signals generated by the S&P 600 trading system.

Table 2: List of S&P 600 index derivatives

By trading S&P 600 index securities instead of stocks from this index basket, you gain stability and predictability that stocks do not have. Our volume-based technical analysis may help you to see the mood in the S&P 600 market sector. The S&P 600 index is far more logical and far more consistent in its actions than the individual stocks of the S&P 600 index basket.