Pay Attention to This Group of Investors (They Know More)

<h3>The stock market actions of corporate insiders is revealing</h3>
<h3>By Elliott Wave International</h3>
<p>It stands to reason that executives of a corporation know more about the goings-on of their business than outsiders.</p>
<p>So, it’s wise to pay attention to their stock market actions regarding their own shares.</p>
<p>Yes, the stock market has been rising. As I write, the Dow Industrials is up for the eighth day in a row.</p>
<p>However, trends can turn on a dime, and if the action of insiders is a clue, that turn may be arriving sooner than many stock market participants anticipate.</p>
<p>Here are just a few Yahoo! Finance headlines from the past few weeks:</p>
<ul>
<li>American Express Insiders Sold US$9.9m Of Shares Suggesting Hesitancy (July 17)</li>
<li>Possible Bearish Signals with Lockheed Martin Insiders Disposing Stock (July 12)</li>
<li>International Business Machines Insiders Sell US$5.6m Of Stock, Possibly Signaling Caution (July 4)</li>
</ul>
<p>These are by no means all the corporations where insiders have been selling company shares. I just picked out three well-known names as examples.</p>
<p>The July <em>Elliott Wave Financial Forecast</em>, a monthly publication which covers major U.S. financial markets, discussed corporate insider selling and said:</p>
<p>Insiders may sell for various reasons, but one of them isn’t that they believe their firm’s share price is going higher.</p>
<p>That doesn’t mean that insiders are always right or that their market timing is perfect, but as the July <em>Elliott Wave Financial Forecast</em> also notes, it’s best not to ignore the actions of insiders. The publication also showed this chart and added:</p>
<p align="center"><img decoding="async" src="https://www.elliottwave.com/images/club/web_ads/230726-AFFA-BS-InsiderTransactions.jpg" alt="" /></p>
<p>There is one group of investors that is selling shares: insiders. … When insider block sales surged in the early months of [a big down wave], the August 2000 <em>Elliott Wave Financial Forecast</em> noted, “Insiders want out.” As the bear market of 2000-2009 illustrated, when insiders sell, it’s best not to pooh-pooh their stance.</p>
<p>In addition to the Insider Transaction Ratio, also pay close attention to the stock market’s Elliott wave structure.</p>
<p>If you’re unfamiliar with Elliott wave analysis, or simply need a refresher, here’s a quote from the Wall Street classic book, <em>Elliott Wave Principle: Key to Market Behavior</em>, by Frost &amp; Prechter:</p>
<p>The primary value of the Wave Principle is that it provides a <em>context</em> for market analysis. This context provides both a basis for disciplined thinking and a perspective on the market’s general position and outlook. At times, its accuracy in identifying, and even anticipating, changes in direction is almost unbelievable.</p>
<p>Enjoy <strong>free access</strong> to the online version of <em>Elliott Wave Principle: Key to Market Behavior</em> by becoming a member of Club EWI, the world’s largest Elliott wave educational community. Club EWI is free to join and allows you complimentary access to a wealth of Elliott wave resources on investing and trading.</p>
<p>Just follow this link to get started: <a href="http://www.elliottwave.com/free-reports/elliott-wave-principle?utm_medium=aff&amp;utm_campaign=cr-ewp&amp;utm_content=attention&amp;utm_term=affar&amp;utm_source=12cps&amp;acn=12cps&amp;rcn=106aa&amp;dy=aa072623"><em>Elliott Wave Principle: Key to Market Behavior</em></a> — get free and unlimited access.</p>
<div>
<p><em>This article was syndicated by Elliott Wave International and was originally published under the headline <a href="https://www.elliottwave.com/Stocks/Pay-Attention-to-This-Group-of-Investors-They-Know-More?utm_medium=12cps&amp;acn=12cps&amp;rcn=106aa&amp;dy=aa072623"><strong>Pay Attention to This Group of Investors (They Know More)</strong></a>. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.</em></p>
</div>