Where Did all the Volume Go?

As all of the major market indices continue to inch up, I continue to wonder, where did all the volume go? For the time being, it seems as if the institutional investors have stepped aside and let the individual investors and traders hunt for bargains. But this isn't the first time. Institutional pressure has been absent since the end of March. Since then, the market has been pretty much on auto-pilot with retail investors controlling the day to day market action. While the retail investor crowd has helped the major market indices stay afloat of their 50 day Ma's, it is going to take some institutional support to maintain this current trend. In fact, at this point, the institutions can make or break the current lateral trend. If negative earnings or some other unexpected economic news hits the headlines, you can be sure that the institutions will be the first to unload their positions. The retail crowd will then be sure to follow.

Looking at the charts with a technical standpoint, I can see that the indices are just leading themselves up to possible resistance. Even if the indices pierce through the 200 day MA, it will take many weeks/months of forming a base before a real bottom is in place. Without a real, solid bottom in place, how will the markets begin a fresh new uptrend? The likely scenario may be that we either face massive resistance even before we hit the 200 day Ma, or we may lead up to the 200 day MA, poke through it and reverse from there and head lower. It is still too early to tell exactly what will happen. One thing I do know is that I do not expect any significant, nor meaningful moves to be placed without the volume created by institutional investors. With their absence, I can only watch and wait. I know better than to bargain hunt in a downtrend. Although I did not personally go through the downtrend of 2000-2002, I have spoken to others and have studied the past and the risks that were involved (back) then. The same rules still apply and ones mistakes happen to be their best teachers, so it is especially important to be prudent in the current market environment.