NEW YORK (TheStreet) -- As many of you who read my articles are aware, I have been pounding the table about the lack of volume in this stock market. On up days the volume decelerates and on down days the volume has accelerated.
Well, what happened in the stock market on Thursday is what happens when the hedge fund-driven machines decide to sell in unison. The Federal Reserve-induced bubble has popped.
The S&P 500 Trust Series ETF (SPY) volume came in at a whopping 182 million shares traded. That is the most volume since Feb. 3, which happened to be another down day.
Thursday was a total distribution day in the markets. The DJIA lost 317 points, or 1.88%, to 16563.30 and the S&P 500 was down 39.4 points, or 2%, at 1930.67. The Nasdaq was crushed to the tune of 2.09%, or 93.12 points, at 4369.77 while the Russell 2000 was down 2.31% at 1120.07.
The DJIA is now down fractionally for the year to date, all its gains wiped out. The Russell 2000 is now down 4% YTD. So forget about the chest-pumping perma-bulls. I have been cautioning everyone about this stock market in the fact that it was not what it appeared to be.
If traders and investors have a risk management process that works, this selloff comes as no surprise.
On Wednesday, the bulls decided that the U.S. GDP number that showed a 4% increase was the real deal. They failed to mention it was a Q2 number and backward looking.