On the Friday the Wall Street Journal told me retail investors bought the dip on Thursday.
Directly under that headline, they printed a chart showing retail investors sold!
Look at it yourself. Anyone who can read a bar chart can read this one.
The data comes from Vanda Research, a firm that tracks what individual investors are doing.
The first two bars are huge and pointing down. By my reading, that’s close to $400 million of selling before lunch. The middle of the day is noise.
Then the final hour shows one big bar of buying, around $170 million.
The article itself does the maths for you, a few paragraphs down - net selling of $152 million.
So the actual headline should be “Retail investors sold the dip, then bought a slice of it back in the last hour.”
Imagine you run a store.
You lose money from 9 till 3, then claw some back before closing… you would never tell your accountant you had a profitable day. Your accountant would laugh you out of the office.
Headline says buy. Chart says sell.
And the Journal expects me to trust the headline over my own eyes.
I’m sick of being gaslit like this…
And sadly, most people never get past the headline on articles like this…
Someone with a $300,000 portfolio reads “retail investors bought the dip,” assumes the crowd is feeling confident, and decides they’d better get in too.
They make significant financial decisions, based on a headline that the paper’s own numbers contradict.
And this is how people get burned! The truth was printed in plain sight but the headline pointed people the other way.
My rule (which you’re welcome to steal) when the headline and the chart disagree, believe the chart.
Oliver