Technical Analysts' View on Credit Balance Buildup

Credit Balances: A Key Perspective for Technical Analysts

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Technical analysts may view a buildup in credit balances as

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A credit balance results when an investor sells stocks and deposits the proceeds with his broker. Technical analysts view a buildup of credit balances as an increase in a pool of potential buying power that will soon be reinvested in the market. For this reason, such a buildup is viewed as a bullish sign.