Tuesday, May 3, 2016

Growing Pessimism Towards US Stocks Is Bullish

The old American idiom of a day late and dollar short is an phrase easily applied to majority's ability to time (buy or sell) US stocks. The majority, influenced more by instinctual behavioral tendency of the individual to seek acceptance of an emotionally-driven crowd than act independently, views rising and falling stocks prices as bullish and bearish. This tendency that drives them chase when probabilities favor fading relegates the majority as the consistent bagholders of history's panics and trend changes.

Traders, an exceptionally emotional crowd, will turn increasingly pessimistic the longer stocks decline or chop sideways.  The Review of Sentiment tracks this transition for subscribers. 

Headline: We're not getting back to all-time highs any time soon: trader

This is a market that is worried about growth and has determined that a low-interest environment is here for through the end of 2016 at least. Meanwhile, the broader indexes have traded into a narrow, neutral range, which is leaving all of us guessing about direction at this time.



Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.