This Week in the Markets is a weekly series that describes, at a very high level, how we manage our long-term portfolio. We use John Murphy’s inter-market ideas, looking at the performance of equities, bonds, commodities and foreign exchange markets. We attempt to measure appetite for risk, and from that draw conclusions on whether to go long or short these asset classes.

We have various proprietary market algorithms, risk and commodity indicators that we use. But they are for another article. What we show here is intended to be understood and acted upon by investors of every level.

Volume is one of those indicators that cannot be ignored. It does not show an overbought or oversold signal and it does not oscillate. What it does do is provide a measure of conviction for a market and a better reading on investor sentiment.

Most recently, it almost seems that there is an apathetic mood as investors are awaiting for equity markets to break one way or another. During that time (since December 2009), volume has been tapering off, unless it is a down day and sellers appear all too ready to dump shares.

This is the latest of our weekly series “This week in the Markets”. We maintain a long term Asset Allocation Investment Portfolio and this series walks though our market evaluation process, albeit at a very high level.

We all must seek information from a variety of sources. A quick perusal of SeekingAlpha.com and other financial news sites brings forth a plethora of news, opinion, and the odd rather obtuse ravings of those howling at the moon. How does one separate the good from the bad? Modesty prevents us from saying read on.