I view sentiment indicators as being similar to a compass. They do not tell you exactly where you are in a rally or a decline but help you get your bearings in knowing if you are in the early, middle or late innings. Investment advisers are as bullish as they have been in nearly a year and a half according to the NAAIM survey as seen below. This is not something seen in the early innings of a rally. From the NAAIM:
The Investors Intelligence survey is showing 49% bulls and 24% bears. It has generally taken a reading closer to 20% bears or below before we have seen lasting tops. We are getting closer but are not there yet. Consensus, Hulbert and Market Vane are also very close to showing extreme bullishness.
Most sentiment indicators I look at are very close to showing extreme bullishness but are not there yet. I suspect one more push higher where we make marginal new highs would do the trick. This rally is clearly not in the early innings. It is too late for me to want to get long but I want to see the sentiment indicators reach an extreme before going short.