Market Sentiment

As the indices accelerate to the downside — the Dow Industrials are off 240 points as I type this — its as good a time as any to look at the current market sentiment.

These provide a snapshot into when traders and investors get too greedy or fearful. Typically, you can use these measures as a useful short term metric for timing entries and exits. 

And, these data points are much more reliable than the typical anecdotal sentiment discussions: "markets should selloff (rally), ’cause everyone I know is bullish (bearish)."


 CBOE Equity & Index Put/Call Ratio



AAII Investor Bullish Sentiment Survey



AAII Asset Allocation Survey


What do these charts suggest?

This sentiment data implies that bearishness is getting very negative. Its not at the point where a rally is absolutely imminent, but we are slowly moving in that direction.



Here’s our full report today: (click to open the full PDF)


For those of you who haven’t signed up yet, here’s the code for the free trial:

Go to the Fusion IQ home page , then select Subscribe. On the signup page, you will see a line that says Discount Code –  enter "BIGPICTURE07"

and click on update.  The
first 30 days trial is free, but you will need to enter a credit card
number — as long as you cancel before 30 days hence, you won’t get


Category: Contrary Indicators, Markets, Psychology

Crude Oil = $100

Category: Commodities, Energy, Technical Analysis

Yearly High to Low in One Day!

Category: Markets, Psychology, Technical Analysis

New Column up at Real Money (01/02/08)

Category: Apprenticed Investor, Corporate Management, Investing, Markets, Technical Analysis, Trading

Odd Data Point of 2007

Category: Markets, Technical Analysis

2007 Performance Review

Category: Investing, Markets

New Year’s Day Open Thread

Category: Federal Reserve, Markets, Psychology

Happy New Year

Category: Contrary Indicators

Can I Stay Up Late?

Category: Real Estate

Performance of Commodity Sub-Groups

Category: Commodities, Energy