From PragCap:
Ever wary of market risks, David Rosenberg of Gluskin Sheff highlights four signs of investor complacency as the equity market soars to new highs on a near daily basis:
• The Investors Intelligence Survey is flashing 52%, doubling in six months and at a two year high.
• Even the usually more dour AAII poll of individual investors shows a higher share of bulls than at any point in the last two years….
Read full article…
from KingWorldNews:
With continued volatility in global markets, investors and professionals are wondering where the markets are headed from here. This piece will provide a huge clue for investors. Today King World News wanted share with its readers key portions from the latest Investors Intelligence report.
This is an extremely important piece because it shows a significant expansion in the bullish readings on the chart below, into the stock market’s advance off of [...]
KWN
With tremendous volatility in global markets, investors and professionals are wondering where the markets are headed from here. This piece will provide a huge clue for investors. Today King World News wanted share with its readers key portions from the latest Investors Intelligence report.
This is an extremely important piece because it shows increasing pessimism for the third week in a row, even as the market continues to strengthen. Here is the [...]
From Dr. Ed’s Blog:
Industry analysts are not the only ones who’ve been lowering their expectations and curbing their enthusiasm for stocks.
The Bull Bear Ratio, compiled by Investors Intelligence, declined to 1.86 this week, down from a recent high of 2.45 during the week of April 3. It’s the lowest since mid-March.
The change in sentiment has been even more noticeable in the…
Read full article…
There’s a big story in Barron’s this weekend titled “The Worst of Times to Buy Stocks?,” which highlights the gloomy warnings of well-known investor John Hussman and technical guy Walter J. Zimmermann Jr.
Hussman’s bearishness is well known, but the article by Randall W. Forsyth boils down Hussman’s bearishness to five criteria:
• the Standard & Poor’s 500 trading at more than 8% above its 52-week exponential moving average
• the S&P 500 up more [...]
From Pragmatic Capitalism:
…I’ll do the worrying for everyone. How does that sound?
The latest Investors Intelligence poll was just released and showed the bull camp expanding its ranks yet again to 54.8% in the latest week from 52.1%. No matter how good you think the news has been, or how far central banks willing to go, it all looks to be discounted at this point.
The reason I say that is because [...]
kingworldnews.com
With investors as welll as professionals wondering when the global markets will peak, today King World News interviewed 32 year veteran, John Gray, from Investors Intelligence. When asked what he is seeing in terms of sentiment readings and where he believes markets are headed, Gray responded, “We had further gains last week with solid market action. This took the Nasdaq to new highs and this week we had the Dow Jones [...]
by Lance Roberts of StreetTalk Advisors
Complacency Risk Is High
As I was writing this past weekend’s newsletter “A Technical Review Of The Markets” it really dawned on me just how complacent investors have become on the economy, the markets and risk in general. The mainstream media, and most of analysts, are looking at recent improvements in the economic data as a sign that the economy has begun to make a turn for the better. [...]
From Bloomberg:
The 12% rally in the Standard & Poor’s 500 Index since November has pushed optimism to a level last seen when the U.S. stock market began its biggest retreat since 2009.
The proportion of investment newsletter writers who are optimistic on equities rose to 51.1% this week, the highest since May, according to a report from New Rochelle, New York-based Investors Intelligence yesterday. Last year’s peak in bullishness was just [...]
From David Rosenberg:
MORE SIGNS OF CAPITULATION?
The USA Today consensus showed that strategists have cut their year-end S&P 500 targets by 8%.
Wall Street economists are at 40% recession odds, which means if the heads of research allowed them to really say what the probability was it would be 80%.
Bank of America let its chief equity strategist go who was calling for 1,450
on the S&P 500 and the most bullish [...]
by Vics
CNBC has the latest figures from the Investors Intelligence (II) Survey…big drop in bears down to 15.7% while the bulls increased to 57% yielding a bull/bear ratio of 3.63. The link below shows a 4 year chart of the II Survey. The first chart is the bull/bear ratio which has not yet been updated for this week. However, it’s clear that the [...]
by Charles Hugh Smith from Of Two Minds
Guest Post: I’ve Got a Funny Feeling About the Stock Market
The dollar has reached a point of double-bind for the Fed: push it down further or allow it to rise, it won’t matter: either way, stocks will fall off a cliff.
I’ve got a funny feeling that all the ramp-and-camp, extend-and-pretend POMO games propping up stocks are about [...]
by Joe
In his daily note David Rosenberg says that if you haven’t got on the bull train already, it’s too late:
Sorry, but that time has passed. But we will probably get another kick at the can because we are sure that the “event riskâ€, which caused so much turbulence and buying opportunities in 2010 will come around again in 2011. But this is one overextended U.S. stock [...]
by Vics
The markets appear to be getting tired. The NASDAQ, the S&P 500 and the Dow Industrials are currently sitting at, or very near, their highs for year. However, many of the well-known oscillators; MACD, Slow Stochastic, RSI and the Ultimate Oscillator, are showing fairly strong NEGATIVE DIVERGENCES in each of the major indexes warning of some downward movement ahead.
The darling of [...]
by David Rosenberg
1. In Barron’s look-ahead piece, not one strategist sees the prospect for a market decline. This is called group-think. Moreover, the percentage of brokerage house analysts and economists to raise their 2011 GDP forecasts has risen substantially. Out of 49 economists surveyed, 35 say the U.S. economy will outperform the already upwardly revised GDP forecasts, only 14 say we will underperform. This is [...]
by Vics
The Large Specs increased their long exposure considerably and are now net long once again.
The Commercials decreased their long exposure slightly, but this move more or less confirms the Buy signal since the Commercials move inversely to the market.
The Small Investors (Dumb moneyor so the theory goes) also confirmed the Buy Signal generated by the Large Specs (Smart money) by decreasing their long exposure considerably. [...]
The large Specs INCREASED their long exposure slightly. However, they remain NET SHORT. Back on January 15 of this year the large specs gave a big sell signal but they were still net long at that point. The following week (January 22) was the last week they were net long. The long/short ratio for the Large Specs hit a low point of -30% on April 23 which was the recent [...]
http://finance.yahoo.com/news/Why-an-Extended-Bear-Market-etfguide-702986177.html?x=0
History vs. Kool-Aid
The past few months have been an epic fight between sentiment readings and momentum. Thus far, momentum has carried prices higher and defied the validity of sentiment readings. For the market to move higher, it would have to invalidate many decades worth of generally accurate sell signals.
Here are a few of the extremes recorded over the past few months that unequivocally add weight to the sell side of [...]
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