Some Changes In Sentiment

A few weeks ago I was pointing out many of the the multi-year extremes in sentiment. Its only fair that I now point out some sentiment indicators that have come off extremes and are now  in neutral territory:

  • Rydex traders are still positioned slightly on the bearish side (almost neutral) but there has been a big move off of the extremes.

  • Newsletter writers tracked by Hulbert are 25% long the Nasdaq, which is a neutral reading

  • The AAII survey shows individuals on the bullish side.

  • The option ratios are still showing a lot of activity in puts but the put activity has backed off levels we were seeing two weeks ago.

The sentiment extremes we saw a couple of weeks ago are no longer present. However, we have not yet reached bullish extremes and many intermediate term measures are still showing excess levels of bearishness.


Anonymous said...

Our equity sentiment report is relatively
bullish for future returns: both the CBOE put/call data as well as
Investor Sentiment surveys are pointing to excess returns. This is not
surprising given the large sell-off we have seen in markets over the
last two months.

Rally Maturing said...

[...] is increasing evidence that this rally is no longer in its nascent stages. Last week, I laid out a few changes in investor sentiment showing investors moving away from their state of extreme [...]