by Jason Bodner
June 2, 2026
In 1620, an English physician named Robert Burton published The Anatomy of Melancholy, a 1,400-page book about depression. One passing observation in it changed economics forever. Burton noted the price of grain in Antwerp rose and fell with the price of grain in London, even though no merchant could know both prices at the same time. He had stumbled onto something the world would not have a word for until the 20th century. Markets reflect a hidden kind of intelligence. They knew things before most people do.
Market prices seem loud, but the real story is quiet, since almost nobody listens to the strongest signals.
Last week’s macro-overhang lifted. The U.S. and China announced a trade truce. NVIDIA reported earnings on Wednesday and confirmed AI demand isn’t slowing, not even slightly. Saudi Arabia’s sovereign wealth fund committed to buying several hundred thousand AI chips through its new Humain venture. The UAE signed on for half a million more. Inflation data slowed. Memorial Day weekend opened with the S&P 500 at a fresh all-time high and the VIX at 15.74, its lowest reading in months.
Three-days saw three different all-time highs, yet on the surface, the flow data looked almost ordinary.
This is the story of the quiet vibe under the market noise:
Last week, the Big Money Index (BMI) cooled slightly to 64%. By itself, that is unremarkable.
The ETF BMI accelerated to 76.6%. By itself, that is also unremarkable, but the gap between them, 12.5 percentage points, places this week in the 95th percentile of historical differentials. It means institutional money is buying themes through ETFs faster than it is buying individual stocks. That distinction is huge.
Daily flows were heavily weighted toward buying. Buying was steady, broad, and confident. The VXX, the volatility ETF that institutions use to hedge against draw-downs, was the only ETF outflow last week.
Translation: Investors were actively selling their downside insurance.
Underneath these indexes, the rotation is striking. Technology posted 132-inflows against just 12-outflows, the most lopsided ratio in weeks. Industrials posted 69 vs. 11. Materials, which last week had zero-inflows and 14-outflows, completely flipped to 25-inflows and zero-outflows. Consumer Discretionary, which had been bleeding for a month, also flipped from 9-inflows to 61, so the market is not just rallying. It is rotating into the trades that work when capital is willing to take real risk again.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
Theme ETFs are getting gobbled up over multiple days running, as in these ETFs:
Momentum ETFs (like MTUM or SPMO) and small-cap value ETFs (AVUV, IJR) joined them.
Even leveraged international exposure caught a bid.
This is not stock-picking. This is regime positioning. Eight distinct innovation themes are being bought by allocators willing to commit through index vehicles. When institutional capital moves through theme ETFs rather than individual names, it signals conviction in the direction, not just the destination.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
When I see a pattern this unusual, I look back through the data. This week’s setup has a specific positive fingerprint: ETF BMI exceeds equity BMI by 10+ points, both are above 60%, the VIX is under 17, the S&P is within 1% of its 60-day high, and the market has just rallied 8% or more in the prior 60-days.
That combination has fired six times since 1990. October 1996, August 2012, May 2021, February 2024, June 2025, and now May 2026. Five of the six prior signals delivered positive returns at every horizon from three months to two years. The one exception, May 2021, came in flat one year later, not down.
Forward S&P 500 returns from those signals:
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
Results are 100% positive at six-months, nine-months, and two-years out. The average two-year return was nearly 25%, which materially beats the long-run baseline of 21%. The signal is not foolproof. But across a 36-year sample, it has never produced a real loss at the medium and long horizons. The mid-cycle versions of this signal that fired in 2000, 2007, and 2008 do not show up in this filtered cohort, because in those moments the market was grinding rather than recovering.
Today’s setup is out of the recovery playbook. Price and flow are confirming each other. Historically, that has been the cleanest configuration: 2021 fired in stagnant tape, where flows looked strong but price was unwilling to follow. When flows lead and price confirms, the historical record is unblemished.
The setup matters because it tells you what kind of market we are in. Capital is not just buying because there is nowhere else to go. Capital is buying themes — specifically AI, space, semiconductors, cybersecurity, clean energy, innovation, biotechnology, data-infrastructure. Capital is selling its volatility hedges, flipping into materials and discretionary, and broadening leadership beyond the largest names.
The mainstream commentary spent the week worried about inflation, the Fed, and whether the rally had run too far, but the flows say the rally is just getting reorganized. Old leadership consolidating and new leadership emerging, hedges being sold and themes being bought.
Wrapping up, Robert Burton’s 1620 observation was that markets know things people do not. The pattern holds. The flow data this week is screaming a coherent message that the headlines have not yet caught up to. We are in the recovery + conviction setup. Six-prior occurrences, five-clean wins, one flat year. No real losses at six or nine-months ever. The market is positioning early, while attention is elsewhere.
“In investing, what is comfortable is rarely profitable.” – Robert Arnott
Flows tell you what comes next. The question is whether you are positioned for what the flows tell you.
The flow knows.
Navellier & Associates; own Nvidia Corp (NVDA) in managed accounts. Jason Bodner owns Nvidia Corp (NVDA) personally.
All content above represents the opinion of Jason Bodner of Navellier & Associates, Inc.
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Jason Bodner
MARKETMAIL EDITOR FOR SECTOR SPOTLIGHT
Jason Bodner writes Sector Spotlight in the weekly Marketmail publication and has authored several white papers for the company. He is also Co-Founder of Macro Analytics for Professionals which produces proprietary equity accumulation and distribution research for its clients. Previously, Mr. Bodner served as Director of European Equity Derivatives for Cantor Fitzgerald Europe in London, then moved to the role of Head of Equity Derivatives North America for the same company in New York. He also served as S.V.P. Equity Derivatives for Jefferies, LLC. He received a B.S. in business administration in 1996, with honors, from Skidmore College as a member of the Periclean Honors Society. All content of “Sector Spotlight” represents the opinion of Jason Bodner
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