Sunday, June 6, 2010

Investor Sentiment: The Sweet Spot

As we all know there is very little good news here or abroad, and with market volatility picking up, investors have a right to be worried. However, as we have seen time and again, the majority of investors are wrong much of the time. We are now entering the sweet spot where we shall see if they are wrong or right. If the majority of investors are right and if the market continues lower despite the bearish sentiment, then there is a strong possibility of deep and extended losses as buyers did not appear when they should have. From this perspective, little has been decided, and with the NASDAQ 100 and Russell 2000 still above their simple 40 week moving averages, it doesn't seem right to throw in the towel. I like my chances here.



This is the first bullish signal since March 8, 2009.


The "Smart Money" indicator is neutral.


Buyers were cautious and sellers weren't looking for huge pay days.


Currently, the value of the indicator is 47.56%. Values less than 50% are associated with market bottoms.

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