Interested in having a big picture view of the entire market? Over at the Trader Feed blog, Brett Steenbarger suggests that investors can learn a lot about broader market themes by tracking the performance of specific ETFs:

"With ETFs, it's easier than ever to track movements in the U.S. dollar (UUP), commodities (DBC), oil (USO), gold (GLD), overseas stocks (EFA, EEM), and Treasury instruments (SHY, TLT). A review of those charts, along with the charts for stock sector ETFs, provides an excellent view of the rise and fall of various themes.

When psychologists listen to clients, they listen for themes: broad issues that connect the dots of various life events. A client may talk about relationship problems and then suddenly switch gears and discuss trading challenges. On the surface, it looks like a total change of topic. But the psychologist is aware of themes and knows that the real issue is dealing with potential loss."

In the same way, a "total change of topic" in the financial markets may actually be the expression of the same worries or concerns. Once you understand how recession concerns or inflation worries are influencing one sector of the market, "you can see one market move and anticipate movements in other, related ones." By understanding how and why money is flowing into (or out of) certain ETFs at any time, you will also be able to understand which themes are most important at any one time.

NOTE: Please keep in mind that TradeKing does not specifically endorse any of the securities or trading strategies mentioned. Depending on your risk-reward profile, this trade may or may not be suitable for your portfolio. The stocks mentioned are for educational purposes only.

[image: Brett Steenbarger of the Trader Feed blog]