Newsflash: This Stock Market Is Not Loved

Permabulls always say everyone's bearish.

And permabears always say everyone's bullish.

Neither side likes to provide evidence for their views.

So I regularly run through a wide variety of sentiment measures to get a realistic reflection of the market's mood.

According to 7 sentiment measures I track, traders are slightly bearish, even though we're within 1% of the all-time SPX high.

Let's go through them one by one:

1) SPX Options Prices – Bearish

SPX options prices show a high put skew.

I looked at 10% out-of-the money 6-month SPX options. There is currently a 10 point skew on the puts, which is the 98th percentile for the past 5 years.

So relative to calls, traders are paying more for 10% OTM 6 month puts than they have 98% of the time over the past 5 years.

2) ISE Sentiment – Bearish

The ISE Sentiment Index closed at just 63 yesterday (63 puts for every 100 calls).

And its 10-day moving average is just 81.1 — a level that indicates bearishness.

Markets tend to overheat with 10-day MA readings well over 100, so we're not even close to that.

3) AAII Sentiment – Bearish

The latest AAII Sentiment Survey shows that 24.8% of individual investors are bullish.

This is well below the long-term average of 38.4%, and below the 2016 YTD average of 28.1%.

Bearish sentiment is at 38.3%, the highest it's been since the February 11 bottom, when it spiked to 48.7%.

4) Investors Intelligence – Neutral

Yesterday, the Investors Intelligence Survey of newsletter writers showed the 4th straight decline in bullishness with a drop to 44.6% bullish from 49% last week.

Bears are at a 10-week high at 24.3%.

5) CBOE Equity Put-Call – Neutral

The CBOE Equity-Put Call ratio was 0.63 yesterday, which is above the YTD average of 0.5, and right in-line with the 5-year average of 0.65.

This points to neutral sentiment.

6) CNN Fear & Greed Index – Bullish

The Fear & Greed Index is at 61, which is modestly in the ‘Greed' category.

F&G operates on a 1-100 scale, and 50 is neutral)

7) Wall Street Strategists – Bullish

The average year-end 2017 target price for the S&P 500 is 2391.44, according to Bloomberg.

This implies a 9.7% gain from here — basically in-line with historic stock market averages.

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So we have 3 bearish indicators, 2 neutral indicators, and 2 bullish indicators.

Blend them together and you have a slightly bearish crowd.

I'm hearing a lot of bears saying that everyone's complacent… but I just don't see it.

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