Sellers are becoming scarce in the US stock market, signaling potential overconfidence as equities hit record highs.
Low trading volume for declining stocks, accounting for just 42% of total turnover, is the least since 2020, indicating possible overly bullish sentiment.
Past instances have shown that a decline in selling volume preceded pullbacks in stocks, typically ranging from 3% to 5% during bull markets.
While there are conflicting signals in the market, with some concerns such as concentration in technology stocks, other factors like declining market volatility suggest continued room for stock market growth.