SentimenTrader Blog

2019-11-12 | Jason Goepfert | Daily Report

A ratio of cyclical to defensive stocks has broken out to its highest level in more than 5 years for the first time in months; Several options indicators are showing a high likelihood of a volatility event for the VIX within the next two months; The spread between Smart and Dumb Money has reached a scary-wide level; TLT suffered a big outflow

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2019-11-12 | Jason Goepfert | Lite

This is an abridged version of our recent reports and notes. For immediate access with no obligation, sign up for a 30-day free trial now.Risk on assetsOver the past 50 days, a handful of “risk on” assets have all returned more than 2.5%, while “risk off” assets have all lost more than -2.5%, showing a notable coordination in investor behavior.Since 1990, when all the risk-on assets rose at least 2.5% over the past 50 sessions while all the risk-off ones lost at least -2.5%, for the S&P 500 ...


2019-11-12 | Troy Bombardia | Premium

While I was sick last week, several notable things have been going on in financial markets. Let's dive into it:BreakoutsAs global stocks continue to rally, various indices continue to breakout and ex-U.S. equity indices are showing stronger breadth. For starters, the MSCI World Index (including U.S.) broke out to a new all-time high at the start of November.More recently, the MSCI World Index's breadth is improving. The % of members above their 200 dma has reached 75% for the first time ...

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2019-11-11 | Jason Goepfert | Daily Report

Over a rolling 50-day period, a handful of risk-on assets all show good gains, while a basket of risk-off ones all show losses; The S&P 500 hit a new all-time high while the McClellan Oscillator was negative; Various options and VIX indicators are near their most extreme in a year; Put premiums have plunged

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2019-11-09 | Troy Bombardia | Premium

This is Part 2 of a weekly update on the U.S. stock market's long term fundamentals. Part 1 can be found here.  Fundamentals 1-3 years: market timingI don't try to predict the future of the economy. Plenty of very smart people try, and when you add up the successes+failures, the results are usually no better than a 50/50 coin toss. That's why I focus instead on leading economic indicators. Look at what has already happened instead of predicting the future.The economy drives corporate ...

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2019-11-08 | Jason Goepfert | Lite

This is an abridged version of our recent reports and notes. For immediate access with no obligation, sign up for a 30-day free trial now.Public pension tensionPublic pension funds have been adding to their stock allocation, raising it significantly over the past year. They’ve also dropped their allocation to cash so their exposure to a downturn is among the highest in history.Starting in the early 1950s, there was a clear bias toward bonds, which gradually changed during the 1960s and ‘70s ...


2019-11-08 | Troy Bombardia | Premium

The Simple Trading Model With Fundamentals uses the Unemployment Rate as a buy/sell signal filter. However, I've seen various people over the past year use a variation of the Unemployment Rate - the Unemployment Rate's breadth.My version of the Unemployment Rate's breadth looks at how many states' unemployment rates are above their respective 12 month averages. Some market watchers consider this breadth metric to be useful because deterioration in the unemployment rate's breadth often ...

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2019-11-07 | Jason Goepfert | Daily Report

Public pension funds have raised their stock allocations this year, while draining their cash, leaving their exposure among the highest in history; The Dow Industrials and Transports both hit a new high at the same time (intraday, at least) for the first time in more than 400 days; Utility stocks fell below the 100-day average for the first time in 6 months

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2019-11-07 | Jason Goepfert | Lite

This is an abridged version of our recent reports and notes. For immediate access with no obligation, sign up for a 30-day free trial now.Money market mysteryAssets in money market funds continue to ramp higher. Knee-jerk contrarians will take that as a buy signal, but it’s not that easy. Assets aren’t as high as they appear, and when they’ve jumped this much over a 12-month period before, it has preceded some very difficult markets.While the absolute level of money market assets is high, as ...


2019-11-07 | Jason Goepfert | Premium

With another trade-related bout of optimism, traders are pushing the futures higher. The S&P is poised to gap up more than 0.35%.That's not large in the bigger scheme of things, but it's occurring when shorter-term sentiment measures are already stretched. The spread between Smart and Dumb Money Confidence was already extreme wide heading into this morning.Below, we can see future returns in SPY when the Confidence spread was extreme, and then stocks gapped up at least 0.25%. All returns in ...

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