Howdy Junkster,
You noted in a previous post: Let's not forget about the sentiment issue here. Some of the sentiment polls such as the Hulbert Sentiment Index was recently at historic highs of optimism. Likewise with the Market Vane poll. My favorite, Investors Intelligence, is at highs not seen in many a moon.
Unless it is different this time (and who knows it could well be) a correction of some magnitude is just around the corner. Sentiment was my savior and guiding light in the 80s and 90s but back then fewer used it as a trading tool.
Do you subscribe to the "Investors Intelligence site" or is there useful data there without a subscription?
Thank you for your continued input here.
Regards,
Catch
Comments
the VIX, AAII, the Rydex bull and bear fund assets, and much more.
After spinning my wheels as a going nowhere trader for more years than I care to mention obsessing over fundamental and technical analysis, I turned it all around in 1985 when I hit upon sentiment. At least for me, sentiment was the essence of the trading game. I don't use it much now since it has become more en vogue the past decade. Recently, it caught my eye because I haven't seen such a level of bullishness in over 2 decades. And that is never a good sign.
Thank you for your follow-up.
Aside from sentiment, which I suppose could be measured here at MFO via a poll or question, your mention of other sentiment indicators reminds me of techinical indicators as well. To the point of reviewing and/or keeping a close watch of what one may consider to have some merit; I feel a type of intuition is brought forth.
For about 15 years (early 80's - 2000), I kept a daily log of various technical indicators that I would copy from the previous day Wall St Journal and/or from the Nightly Business Report on PBS. I was pleased with the exercise; as it helped build a mental picture of various indexes and indicators (TED spread, daily hi/lo, etc.) Not that all were valid data bases, but I really felt a benefit for the way my brain processed this information.
I used a homemade bar graph type of layout. Any data that reflected a negative direction was noted for the day in red ink, positive direction in black ink. I was able to quickly view across the page for "trends" via the color zones that were formed.
An, oh well; for many. But, the method helped me "see" movements.
'Course today we may troll through the internet sites to find what we presume to be of value. I do print various charts from time to time to hang upon the wall as reminders of something I felt was of value that day; cause my memory isn't what it used to be and there are too many other projects in place at this time, at this house.
As you well know, somewhere among the blend of sentiments, technicals, fundamentals and central bank/political perversions; one works to find as many pieces of the puzzle to satisfy building an investment picture. I do believe having one's face into the daily mix of numbers can be of benefit, as I strongly feel this can bring about an intuition to help smooth the investment decisions.
Take care,
Catch
The housing market and the gold market are other examples of bullish sentiment that kept on going long after many were saying a correction was coming. Perhaps the higher the sentiment reading, the harder the fall?