THE LMTR EDGE:

Join over 25,000 investors and get alerts for:
  • Market Timing Reports
  • Sentiment Updates
  • Chart of the Week
  • Weekly Podcasts
  • The Magic Number - Top Stocks

Wishy Washy Sentiment Numbers Mean Stock Market Investors Should Remain Cautious

We use investor sentiment as an important gauge on the direction of the stock market. The latest Investor Intelligence Bulls/Bears poll of newsletter writers show that the May and August corrections were not strong enough to create the type of negative sentiment signaling buying opportunities that traditionally occur at intermediate lows. We expect subsequent corrections will be even worse, because of the lack of market breadth that spurred recent market upticks, and a weakening economy. Bigger corrections will eventually turn sentiment negative enough to signal buying opportunities.

Meanwhile, the recent poll shows the spread between bulls and bears at a neutral 26.2%. Bullish sentiment was at 44.9% and bears at 18.7%. For contrarians, that low bear reading means this is not the time for major buying since there’s little cash on the sidelines to spur future stock market growth. In other words, we seem to be in a lull before the storm.

Wishy Washy Sentiment Numbers Mean Stock Market Investors Should Remain Cautious
Wishy Washy Sentiment Numbers Mean Stock Market Investors Should Remain Cautious

Brad Lamensdorf

Brad Lamensdorf, the founder and portfolio manager of Active Alts, is a principal and co-manager of the AdvisorShares Ranger Equity Bear ETF. He previously managed a long-short investment partnership from 1998-2005 under the name Tarpon Capital Management. Earlier in his career Mr. Lamensdorf was an equity trader/market strategist for the Bass Brothers’ trading arm. He managed a short only portfolio in addition to co-managing a $1bil hedging program. He also served as in-house market strategist for the entire internal and external network of Bass Brothers money managers.

Leave a Reply

Your email address will not be published. Required fields are marked *

2018 - All Rights Reserved © LMTR, LLC

Privacy Policy - Contact Email: info@lmtr.com