In the U.S. stock market, the tail could be wagging the dog.
According to top technician Carter Worth, the growing presence of exchange-traded funds is playing a significant role in the price action in equities. And by his work, that could lead to a lot more selling.
"A lot of individual stocks, it turns out, were being influenced not by what was going on at the stock level but at the ETF level. So a major selling in baskets, forcing stocks themselves to drop significantly, and not on a lot of volume," Cornerstone Macro's Carter Worth said on Monday's "Fast Money."
Last Monday, when the market experienced a 1,000-point drop, moves in the ETFs that track the major indices were not trading in sync with the indices themselves. Worth said that this is caused by knee-jerk "unnatural and robotic" selling in ETFs that can actually drag down the very index that it is tracking.