Several sentiment indicators are signaling that the markets are overbought. ITZ takes a look at the $SPXA50R, $SPXA150R & $SPXA200R stocks trading over their respective 50, 150 & 200 day moving averages.
The AAII Investor Sentiment Survey measures the percentage of individual investors who are bullish, bearish, and neutral on the stock market for the next six months; individuals are polled from the ranks of the AAII membership on a weekly basis. Only one vote per member is accepted in each weekly voting period.
The Bullish Reading peaked a few weeks ago over 50%, although not a perfect timing indicator...it raises a caution flag that a reversal lower is over due.
Range of Responses:
200% Leveraged Short
100% Fully Short
0% (100% Cash or Hedged to Market Neutral)
100% Fully Invested
200% Leveraged Long
The green line shows the close of the S&P 500 Total Return Index on the survey date. The purple line depicts a two-week moving average of the NAAIM managers’ responses.