Coleman noted the number of insider sales transactions rose 28 percent in the past week versus the previous week, while the number of insider purchases fell by 34 percent in the same time period.
The S&P 500 fell officially into correction territory in early February, down more than 10 percent from its record reached in January. But the benchmark has come roaring back, in part boosted by corporate stock buybacks. The major averages are less than 4 percent from their old highs.
Traders blamed the sell-off on increasing worries about rising inflation and the prospect for a faster pace of interest rate hikes by the Federal Reserve. The U.S. 10-year Treasury yield, which moves inversely to bond prices, had climbed to a four-year high of 2.95 percent earlier in the month after the strong January jobs report.
Coleman said the market correction may not be over because of stock valuations.
“The main reason to worry that stocks are not yet done correcting is that, even after the pullback, the stock market is far from cheap,” he wrote. “The days of indiscriminate gains, and the complacency that environment bred, is a thing of the past.”