Posts Tagged ‘AAII’

Market Still Deluding Itself That It Can Escape The Inevitable Dénouement

Market Still Deluding Itself That It Can Escape The Inevitable Dénouement

Courtesy of John Mauldin, Outside the Box 

One of my favorite analysts is Albert Edwards of Societe Generale in London. Acerbic, witty and brilliant. Emphasis on brilliant. The fact that he is a Doppelganger for James Montier (who long time readers are well acquainted with) is a coincidence (or he would say vice versa). I only kind of have permission to forward this note to you, but better to ask forgiveness… So, this week he is our Outside the Box. And a short but good one he is.

High angle view of glasses of red and white wine

I am in Amsterdam and it is late, but deadlines have no time line. Tomorrow more work on the book. It is getting close to the end. Most books are finished when the authors quit in disgust. How many edits can you do? I am close.

I wonder late at night, with maybe a few too many glasses of wine, why I feel like a book is so much more than an e-letter. Really? The last ten years of what I have written are on the archives. Good (ok, sometimes really good) is there. But some are an embarrassment. What was I thinking?

But somehow in my Old World brain, a book is more than a weekly letter. It is somehow more permanent than an “online” letter. Which may be archived forever. The book is “paper” and may be around for a few years. But the online version is here for a long time.

I know that is stupid. Really I do. But what is a 61 year old mind to do? A strange world we live in.

It is really time to hit the send button. More than you know! The conversation tonight has been too deep!

Your trying to figure out the purpose of life analyst,

John Mauldin


Market still deluding itself that it can escape the inevitable dénouement

By Albert Edwards

The current situation reminds me of mid 2007. Investors then were content to stick their heads into very deep sand and ignore the fact that The Great Unwind had clearly begun. But in August and September 2007, even though the wheels were clearly falling off the global economy, the S&P still managed to rally 15%! The recent reaction to data suggests the market is in a similar…
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SMALL INVESTOR BULLISH SENTIMENT SOARS NEAR 2010 HIGH

SMALL INVESTOR BULLISH SENTIMENT SOARS NEAR 2010 HIGH

Courtesy of The Pragmatic Capitalist

Talk about a schizophrenic market. Just two weeks ago the sky was falling.  As sentiment plummeted the excessively fearful shorts were caught flat footed and an impressive short covering rally ensued. Now, just a few economic reports and a brief rally later small investors are convinced that there are no risks coming down the pike.  The AAII’s bullish sentiment survey showed a remarkable rebound in recent weeks. After hitting 21% just two weeks ago the percentage of bullish investors has surged to 43.9% – the highest reading since April 15th when sentiment hit 48.5% and just days prior to the Q1 market peak.  AAII elaborated on the results:

“Bullish sentiment of individual investors rose 13.1 percentage points to 43.9% in the latest AAII Sentiment Survey. This is the most bullish individual investors have been on the market outlook six months forward since bullish sentiment reached 48.5% on April 15, 2010. The historical average is 39%.

Over the last two weeks, investor sentiment has swung from bearish sentiment outweighing bullish sentiment by 28.7 percentage points to bullish sentiment outweighing bearish sentiment by 12.3 percentage points.

Bullish investors predominately mention that pessimism seems to have reached an extreme which should favor stocks going forward–the sky is not falling.”

AAII SMALL INVESTOR BULLISH SENTIMENT SOARS NEAR 2010 HIGH

The Investors Intelligence survey also showed a rebound in sentiment as bullishness jumped to 33.3% from last week’s reading of 29.4%.  Although there has been a slight rebound in this data it is not at the same extremes seen in the AAII data.

II1 SMALL INVESTOR BULLISH SENTIMENT SOARS NEAR 2010 HIGH

Source: AAII, II 


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SENTIMENT TAKES A TURN FOR THE WORSE

SENTIMENT TAKES A TURN FOR THE WORSE

Courtesy of The Pragmatic Capitalist

Investor sentiment took a turn for the worse this week as most investors became increasingly bearish.  The Investor’s Intelligence survey showed a steep 5% decline in bullishness while the AAII‘s survey showed an even larger decline of 9.7%.   Although both surveys have declined dramatically in the last week neither is at extremes:

II2 SENTIMENT TAKES A TURN FOR THE WORSE

aaii3 SENTIMENT TAKES A TURN FOR THE WORSE

Charles Rotblut of AAII elaborated on the AAII results:

“Bullish sentiment, expectations that stock prices will rise over the next six months, fell 9.7 percentage points in the latest AAII Sentiment Survey. Bullish sentiment registered 30.1%, a six-week low. The historical average is 39%.

Neutral sentiment, expectations that stock prices will be essentially unchanged over the next six months, fell 2.7 percentage points to 27.4%. The historical average is 31%.

Bearish sentiment, expectations that stock prices will fall over the next six months, rose 12.4 percentage points to 42.5%. This is a four-week high. The historical average is 30%.

Bearish sentiment has been firmly above its historical average for 14 out of the last 15 weeks. Sustained volatility in the market, continued economic uncertainty, a negative year-to-date return for the S&P 500 and low bond yields are all combining to fray individual investors’ nerves. Confidence is likely to remain fragile until investors have a sense that a bottom has been established for stock prices.”

Source: AAII & II 


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BULLISH SENTIMENT DROPS SUBSTANTIALLY

BULLISH SENTIMENT DROPS SUBSTANTIALLY

Courtesy of The Pragmatic Capitalist

After having entered the year in an overwhelmingly bullish fashion, investors have tempered their bullish perspective a bit.  The latest sentiment reading from AAII showed a sharp decline from 49% to 41% bulls.  Many investors have expressed caution due to the high reading coming into the beginning of the year.   This less bullish position is consistent with the recent data on small speculators from the CFTC.

aaii BULLISH SENTIMENT DROPS SUBSTANTIALLY

 


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BULLISH SENTIMENT WAVES WARNING FLAGS

BULLISH SENTIMENT WAVES WARNING FLAGS

Courtesy of The Pragmatic Capitalist  

Sentiment hasn’t been this positive about the stock market since just before the 1987 market crash.  The latest readings from Investors Intelligence and AAII show that newsletters and small investors are very bullish in the near-term.  This could be a major warning flag about the potential short-term performance of the equity markets.

The Investors Intelligence poll, which tracks 140 different newsletters, hasn’t been this bullish(?) since 1987.  This has proven to be a superb short-term indicator.  The last extreme was a 54% bearish reading at the October lows last year.  Now, at 15% bears, the bulls feel equity markets have much room to run.

The survey of small investors at AAII is also showing an extreme level of optimism with 49% of investors bullish. It’s interesting to note the high level of put buying on Friday as investors hedged themselves heading into the new year.

AAII BULLISH SENTIMENT WAVES WARNING FLAGS

VN:F [1.7.8_1020]
 

 


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THE PYSCHOLOGICAL ROLLERCOASTER

THE PYSCHOLOGICAL ROLLERCOASTER

Courtesy of The Pragmatic Capitalist

The latest data from the AAII shows just how confused investors are regarding the current market environment and whether the recovery is real.  Just 10 days ago the market was in the middle of a minor 6% decline and it appeared as though earnings were largely priced in and that economic data was beginning to disappoint.  Markets tanked nearly 3% the day before Halloween as comments from Carl Icahn and Wilbur Ross spooked the market.  Same store sales compounded the fears.  Investor sentiment tanked to it lowest level since the March 8th low.  A few earnings reports and economic reports later and the market has rebounded over 7% and psychology  skyrocketed.   Although we’re not quite at a psychological extreme this uncertainty is likely to persist and paying close attention to the psychological extremes will likely continue to reward investors as the economy continues to confound investors.

AAII

 


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Boeing is doing crisis management all wrong - here's what a company needs to do to restore the public's trust

 

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Boeing is doing crisis management all wrong – here's what a company needs to do to restore the public's trust

Courtesy of Kelli Matthews, University of Oregon

In a crisis, time is not on your side.

A crisis creates a vacuum, an informational void that gets filled one way or another. The longer a company or other organization at the center of the crisis waits to communicate, the more likely that void will be filled by critics.

That’s exactly what&...



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Kimble Charting Solutions

Connect Series Webinar March 2018

Courtesy of Chris Kimble.

We cover dominating patterns in major global Indices, sectors, commodities and the metals markets.  We produce chart pattern analysis and empower people to improve entry and exit points.

To become a member of Kimble Charting Solutions, click here.

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Zero Hedge

US Home Price Growth Slowest Since 2012

Courtesy of ZeroHedge. View original post here.

Following disastrous starts and permits data, Case Shiller's home price index was expected to show growth continuing to slow. and it did, considerably worse than expected.

Case-Shiller's 20-City Composite grew at just 3.58% YoY in January (well below the 3.8% YoY expectation and December's 4.14% YoY print). This is the weakest annual growth since September 2012, decelerating for a 10th month in January as buyers held out for more affordable properties.

...



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Insider Scoop

Analyst: Apple's New Credit Card Bodes Well For Green Dot

Courtesy of Benzinga.

Apple Inc. (NASDAQ: AAPL) announced Monday it will launch its own branded credit card called Apple Card and this should be viewed as a positive for Green Dot Corporation (NYSE: GDOT), according t...



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ValueWalk

Tesla's Massive Increase In Delivery Volume In Europe And China

By Jacob Wolinsky. Originally published at ValueWalk.

Whitney Tilson’s email to investors discussing a few good posts on Tesla on the VIC message board about the massive increase in delivery volume in Europe and China.

41 – jcoviedo – 3 days 2 hrs ago

Re: Re: Re: Several bullish points

40

Q4 hedge fund letters, conference, scoops etc

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Chart School

Weekly Market Recap Mar 24, 2019

Courtesy of Blain.

It was looking like another week of Federal Reserve Kool Aid and crushing bears .. until Friday.  On the back of bad economic news out Europe, the yield curve inverted on the 3 month vs 10 year bond – before you fall asleep to that news, it is a quite important indicator for the economy (not necessarily the stock market… yet).   More on that in a bit.  As you can see the action in the bond market Friday was quite severe so it will be interesting to see the move in the coming few days.

As for the Federal Reserve:

The Federal Reserve signaled no more increase in interest rates this year and just one in 2020, according to its new ‘dot plot,’ and the bank said it would...



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Biotech

Marijuana is a lot more than just THC - a pharmacologist looks at the untapped healing compounds

Reminder: We are available to chat with Members, comments are found below each post.

 

Marijuana is a lot more than just THC - a pharmacologist looks at the untapped healing compounds

Assorted cannabis bud strains. Roxana Gonzalez/Shutterstock.com

Courtesy of James David Adams, University of Southern California

Medical marijuana is legal in 33 states as of November 2018. Yet the federal government still insists marijuana has no legal u...



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Digital Currencies

Facebook's cryptocurrency: a financial expert breaks it down

 

Facebook's cryptocurrency: a financial expert breaks it down

Grejak/Shutterstock

Courtesy of Alistair Milne, Loughborough University

Facebook is reportedly preparing to launch its own version of Bitcoin, for use in its messaging applications, WhatsApp, Messenger and Instagram. Could this “Facecoin” be the long-awaited breakthrough by a global technology giant into the lucrative market for retail financial services? Or will...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

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Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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