Posts tagged as Models

Less greed and more warnings

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Stocks are hitting new highs, and with less greed

A less greedy highMany sentiment indicators hit historic extremes of optimism in December and January. After stocks dipped in late January, sentiment reset. Now that they’ve moved to new highs, it’s being accompanied by less optimism.The CNN Fear & Greed index is a model created by and published ...

Read More ...

---

Sentiment Is Normalizing As Technical Warnings Trigger

Not quite normalAfter hitting optimistic extremes – and then staying there for weeks on end – sentiment has started to normalize. It’s not quite back to a neutral range but is getting there quickly.Even so, when it has been stretched as much as it has, just getting to neutral hasn’t been enough ...

Read More ...

---

'Big Four' Indexes Register Warnings As Sentiment Recedes

Big four warningsWith an increasing number of stocks “splitting” this week, all of the “big four” stock indexes have triggered technical warning signs. The last time the S&P 500, Dow Industrials, Nasdaq Composite, and Russell 2000 all did so was last May right before a pullback.Even though these ...

Read More ...

---

An Extreme - And Protracted - Stretch Of Optimism

Extreme, and protractedOn December 26, a bout of enthusiasm pushed 56% of our core indicators into an optimistic extreme, which was the most in 15 years. We just surpassed that, with 57% of them hitting an extreme on Thursday. For the past month, there has been an extreme number of indicators ...

Read More ...

---

The "Energizer" Rally Keeps Going Despite Rising Jobless Claims

The Energizer rallyDespite extremes in sentiment which started to pop up in November, stocks continued to rally. After the spread between Smart and Dumb Money fell to -50%, the S&P has since enjoyed almost uninterrupted upside. This is the best reaction in 20 years after such extreme ...

Read More ...

---

What I'm looking at: breadth thrusts, financial conditions, USD, copper

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Investor And Advisor Optimism Is The Highest In Years

Investor and advisor optimism has spiked, as the yield curve goes from inversion to the steepest in a year.AIM (Advisor & Investor Model)With the U.S. stock market trending higher into year-end, more and more market investors are turning optimistic towards U.S. equities. This stands in stark ...

Read More ...

---

Traders Buy Calls As Smart/Dumb Money Plunges

There is now a historic spread between Smart Money Confidence and Dumb Money Confidence, as the Equity Put/Call Ratio plunges.Historic spreadBuilding on a true extreme reached late last week, the spread between Smart and Dumb Money Confidence widened further, stretching to a threshold rarely ...

Read More ...

---

Near-Record Levels Of Optimism

Dumb Money Confidence has spiked while Smart Money is retreating.Near-record optimismA year ago, the “dumb money” was the most bearish in 20 years. Now, a year later, they’re the 2nd-most optimistic, barely eclipsed by a few days in April 2010. Indicators focused on the “smart money” are near ...

Read More ...

---

Smart Money / Dumb Money Confidence Spread < -63%

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Adding emerging markets to models

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Bull Stampede

The Rydex family of mutual funds is showing that investors are almost the most bullish on record.Bull stampede at RydexIn the Rydex family of mutual funds, traders have positioned themselves in perhaps the most aggressive way ever.It’s not hip to be a mutual fund manager anymore – all the cool ...

Read More ...

---

CNN Fear & Greed Model Above 80

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

What I'm looking at - OECD, advance-decline line, VIX, NASDAQ models + sentiment indicators

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Applying sentiment indicators to different models

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Looking At A Potential Risk Failure

We're seeing potential failure in some warning signs, as financial conditions ease.Failed warnings…maybeDue to extremely high optimism across a broad array of indicators, our  Medium-Term Risk Level has been elevated for a few weeks. And yet, the S&P 500 is higher now than when risk first ...

Read More ...

---

What The Breakout In Small Caps Might Mean

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.Intermediate Term Optimism IndexWith the stock market pushing higher relentlessly, sentiment remains elevated. Our Intermediate Term Optimism Index's 20 day ...

Read More ...

---

Testing Unemployment Rate Breadth

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Trade Gap

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Smart / Dumb Money spread widens

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Smart Money vs Dumb Money Is Getting Extreme

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.Confidence conflictQuite a few times over the past couple of months, we’ve discussed how various aspects of sentiment were curiously subdued. From individual ...

Read More ...

---

Testing unemployment models for other countries besides the U.S.

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Testing earnings models for other countries besides the U.S.

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

ETF traders pull out of small caps as fear creeps in

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.Small slumpThe IWM small-cap fund has been suffering one of its worst stretches in a decade, with ETF traders consistently pulling money from it over the past ...

Read More ...

---

Testing indicators + models

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

What I'm doing - applying the Stock/Bond ratio to models

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Gold Has Only Done This 4 Other Times

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.Stocks down, bonds upHeading into the last few sessions of the month, the total return on the S&P 500 was on track for one of its worst in almost 30 years ...

Read More ...

---

What I'm looking at - DAX, Put/Call, all-or-nothing, gold:silver ratio, AUDUSD

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Stocks Have Gone Absolutely Nowhere

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.Going nowhereThe most benchmarked index in the world has gone nowhere for over a year and a half. The S&P 500 was just trading at the same level it was at in ...

Read More ...

---

Market overview: combining technicals & fundamentals

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Financials As A Sick Canary

Financial correctionLess than three weeks ago, financial stocks within the S&P 500 were within spitting distance of a fresh 52-week high. Now they’re mired in a correction, having pulled back more than 10% from their high.That’s a quick turnaround, which always worries investors. This was not a ...

Read More ...

---

The Dumb Money Is Nearing Maximum Confidence

Confidence nears upper boundOver the last couple of days, Dumb Money Confidence has poked above 80%. While it has gone higher over the past 20 years, this is in the top 2.3% of all readings.'It’s high enough that it has preceded weak returns, especially in recent years, and those times when ...

Read More ...

---

Dumb Money Confidence Reaches 80%

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Wednesday Color - Dow Stocks, Dumb Money, Gamma, Microsoft Expectations, Germany

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

This Has Only Happened Twice In 40 Years

High confidenceDumb Money Confidence has recovered from its dip below neutral territory in May. Now above 77%, it’s to a level that has preceded weak annualized returns in stocks.As a signal, the first reading above this level after a dip below 50% has led to mostly weak short- and medium-term ...

Read More ...

---

Monday Color - Short-Term Optimism, Funds Vs Options, Lagging Small Caps And Surprises, Bulls Return, Bonds

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Tuesday Color - Fund Manager Panic, New Model, OEX, UAE, Miners

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

What A Steeper Curve Really Means

Curve steepensInvestors are fairly obsessed with the yield curve and its potential message for all markets. The widely watched spread between 2- and 10-year Treasuries neared inversion but has quickly reversed and hit its highest level in 6 months.The steepening is often what causes trouble, but ...

Read More ...

---

From Risk-On To Risk-Off In Near-Record Time

Risk-on to risk-off in a monthIn April, investors were showing extreme risk-on behavior, according to their eagerness to buy some markets over others. Barely a month later, that has cycled to extreme risk-off behavior.The first risk-off reading following risk-on behavior has usually led to a ...

Read More ...

---

Confidence Has Flipped From Dumb To Smart

Confidence flipFor the first time in four months, Smart Money Confidence has moved above Dumb Money Confidence.Usually by the time the spread between them has flipped after several months, stocks were seeing the last bits of selling pressure.With one major exception, these were mostly good ...

Read More ...

---

Sentiment Is Curling

Summation finally weakensWe’ve discussed the McClellan Oscillator and Summation Indexes a lot in recent months, because they have been showing notable readings of momentum. That’s starting to ease with the long-term Summation Index, which dropped below 750 for the first time in months, ending ...

Read More ...

---

Most Confident "Dumb Money" In A Decade

Maximum optimismDumb Money Confidence has been climbing steadily for a month, and stocks have so far shrugged off that extreme optimism. Now it has reached its highest level in a decade.Every date that saw this high of a reading in the past 20 years sported a negative return in the S&P 500 at ...

Read More ...

---

Dumb Money Confidence Highest In A Decade

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Tuesday Midday Color

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Wall Street Analysts Are Catching Up To Dumb Money

Not-so-dumb moneyDumb Money Confidence rose to an extreme in February, yet the S&P 500 has tacked on more than 5% since then, suggesting it’s not so dumb after all. The recent gains in stocks have attracted more of these traders, and their Confidence just surged to a new high – that has been a ...

Read More ...

---

Tech's Perfect Signal

Tech’s fully recoveryOut of the S&P 500’s 11 major sectors, only one has made a fully recovery from the December decline, and it’s an important one. The information technology group has fully recovered from its decline of more than 24%.Other times it fully recovered a drop of 20% or more within ...

Read More ...

---

What Happens When Oil Recovers From A Plunge

A crude recoveryAs markets sold off in December, crude oil futures fell more than 30% below the 200-day average, one of the largest deviations since their inception in 1986. This week, they made a complete recovery, now trading above the 200-day.Other times the commodity recovered from such a ...

Read More ...

---

Dumb Money Does A 180

Full recoveryOver the past 50 days, Dumb Money Confidence has averaged 70%, the highest since early 2018. This marks a complete cycle from the extreme pessimism in December. When the 50-day average first breaches the 70% level, it has typically coincided with a temporary reprieve in unrelenting ...

Read More ...

---

Tuesday Midday Color

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

No Pessimism Even As Small-Caps Struggle

No pessimismOn Monday, the last of our core indicators that was showing a hint of pessimism dropped off. At the same time, 40% of them were showing optimism. The last two times that happened, the S&P formed a kind of rounded peak.Since 1999, many of the positive returns were clustered in 2017, a ...

Read More ...

---

Tuesday Midday Color

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Wednesday Midday Color

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Slowing GDP As Survey Sentiment Rebounds During A Nice Couple Of Months

Slowing growthThe GDP release relieved some investors by being better than feared. But forecasts show that growth this quarter is likely to be the lowest in 8 quarters.Like we’ve seen during past studies looking at economic or earnings recessions, the hype doesn’t often translate to forward ...

Read More ...

---

Wednesday Midday Color

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Extreme Greed As Utilities And Yields Forge Unholy Alliance

Extreme greedThe CNN Fear & Greed proxy model has moved further into optimistic territory, now showing Extreme Greed, pushed higher by most of the components in the model.Other times it has become this stretched in a downtrend, future returns were almost exclusively negative. There were 99 days ...

Read More ...

---

Back To Greed; Low Exposure; Oscillator Streak

This is an abridged version of our Daily Report.Back to greedThe CNN Fear & Greed model has gone from extreme Fear in December to Greed now.It’s not unusual to see it swing this much, this quickly, but it is unusual when the S&P 500 still hasn’t made it above its 200-day averages. And those ...

Read More ...

---

CNN Fear & Greed Back To Greed

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Narrowing Smart-Dumb Spread; 4 Straight Up Weeks

This is an abridged version of our Daily Report.Narrowing spreadAs stocks rally, Dumb Money has become more confident while Smart Money has increased their hedging activity. The spread between the two hit a multi-year extreme before Christmas and is now nearing zero for the first time in ...

Read More ...

---

Smart - Dumb Money Spread Nearing Zero

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Studying The Studies

This is an abridged version of our Daily Report.Studying the studiesLike last year, we take an objective look at the studies posted to the site in 2018. Using a conservative estimate of their expected value, we can see that it still makes sense to observe the markets in this way. When we ...

Read More ...

---

A Pre-Holiday Review

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Another Volatile Session

This is an abridged version of our Daily Report.Another volatile sessionSome early optimism on Thursday was quickly erased, and stocks dove to new lows for this move. In the process, it triggered several extremes:* The Nasdaq is on the threshold of a 20% decline.* The percentage of securities ...

Read More ...

---

Oil And Energy Collapse; RSI Divergence; Smart-Dumb Money Extreme; Overwhelming Lows

This is an abridged version of our Daily Report.No energyCrude oil collapsed with a large loss and 52-week low on Tuesday. That’s not what the Energy stock sector needed right now but taking the chance that we’re whistling past the graveyard, the losses on Monday and Tuesday may just be bad ...

Read More ...

---

Testing A Wide Disparity Between Smart And Dumb Money

With the volatility in stocks this week, the spread between Smart Money and Dumb Money Confidence rose to 55%, the widest since January 2016.Our Confidence indices use mostly real-money gauges - there are few opinions involved here. Generally, we want to follow the Smart Money traders when they ...

Read More ...

---

Thanksgiving Selling; Heavy Pessimism; Monday Gaps

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

A Bad Month; Wide Confidence Spread

This is an abridged version of our Daily Report.A bad monthThe S&P suffered 16 negative days in October, tied for 3rd worst since 1928 and the most since 1970.The pressure was enough to trigger a sell signal for a popular trend-following strategy, with a close below its 10-month average, that ...

Read More ...

---

Stocks, Sectors In Correction; Nasdaq's Bad Day; S&P Negative YTD; Spike In Pessimism

This is an abridged version of our Daily Report.Stocks in correctionThe S&P still hasn’t suffered a correction, if we define it by a 10% decline from a 52-week high. With the severe loss on Wednesday, it has just barely missed the cut. Most of its stocks haven’t been so fortunate, however. With ...

Read More ...

---

Major Reversal; Jump In New Lows; Dumb Money Purge

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

Quick Change In Character; Smart Money Steps In; Emerging Stocks Rebound

This is an abridged version of our Daily Report.A quick change in characterThe S&P went from 52-week high to below its 200-day average in only 3 weeks. That ended a streak of more than six months above its 200-day average. Other times it underwent a quick change in character, from a 52-week high ...

Read More ...

---

Goldman Model Predicts Trouble As Grains Get Hit

This is an abridged version of our Daily Report.Model troubleA Goldman Sachs model incorporating five fundamental factors shows a high risk of an imminent bear market in stocks.When the model reaches its current level, the average S&P 500 return over the next six months was negative 6%.No gains ...

Read More ...

---

Most Shorted Stocks Surge With Optimistic Momentum

This is an abridged version of our Daily Report.Short squeezeThe most shorted stocks in the market have outperformed the S&P by a wide amount in recent weeks. An index of heavily shorted stocks has jumped nearly 10% to a new high.After similar short squeezes, the S&P outperformed heavily shorted ...

Read More ...

---

Model Updates

We've had some requests to post updates on a few popular models from the site, so below are current snapshots of the spread between our Smart Money and Dumb Money Confidence, the Medium-Term Optimism Index, and a proxy of the CNN Fear & Greed model.All three reached modest levels of pessimism in ...

Read More ...

---

Strategy Development with the STEM.MR model

This post is available to SentimenTrader members and/or Premium members only.

Please login to to view this content

---

New Functionality: Threshold Returns for Models

This weekend we added Threshold Returns, a small (but important) new piece of data to our models.Threshold returns provide a view into the annualized returns for the underlying symbol while the model/indicator value is above / below / between the extreme values for that model/indicator. ...

Read More ...

---

next page →