by AJ Fabino, Senior Editor, Stock Trader Network

For years, one of the supports under the U.S. stock market has been shrinking supply. Companies would buy back stock, then private equity took companies off the market and the number of available shares kept moving lower. That may be changing right now. 

What changed: The Financial Times reported Wednesday that Goldman Sachs expects net U.S. equity supply to be roughly flat in 2026 for the first time since 2003, with a larger wave of supply potentially coming in 2027 as major IPO lockups expire.

Why Chris Brecher cares: Stock Trader Network host, Chris Brecher, of The Trading Nest, sees alpha here. His read is that the market has had a steady buyer for years—the companies themselves. Buybacks helped shrink the supply of stock and gave weak tape a cushion, but if IPOs, share sales and AI-driven capital raises start putting more stock back into the market, that cushion gets thinner.

The key quote: As Brecher put it during a live STN show Wednesday, “buy backs are going to be countered with supply.” That changes the way he wants traders to think about bearish setups. A resistance level matters more if the stock has less corporate buying underneath it. A weak tape matters more if the biggest natural buyer is in blackout, slowing down or less active during key parts of the session.

Alpha Bite: Brecher’s point was that bearish setups deserve more respect when the buyback bid is weaker, paused or missing. Whether the issue is “buyback, blackout buy backs, or lack of buy backs,” he said, “bearish patterns are more likely to work.”

The trading idea: The trade is not to short every company with a buyback. It is to find a stock with a major buyback program that is near resistance, inside or near a buyback blackout window and starting to print a bearish reversal. Then watch how it acts when the broader market gets hit.

How to read the tape: If the stock refuses to go lower during the day while futures are weak, it may be getting helped by the corporate bid. But if that bid is less available into the close, especially inside the final 10 minutes, the selling pressure can show up fast.

The example: JPMorgan was Brecher’s example. The stock was near a resistance zone, the broader tape was weak and the company had moved into the window where buybacks are often paused ahead of earnings. That did not mean JPMorgan had to go down. It meant the bearish chart deserved more respect.