Weekly Sentiment Update: The Bears Are Done Hibernating… and They’re Hungry

March 24, 2017
/ By Michael Comeau

Permbulls always say everyone's bearish.

And permabears always say everyone's bullish.

But let's look at the actual numbers to see how the crowd actually feels.

Last week, sentiment went neutral for the second straight week.

The big news this week is today's healthcare vote (well, let's hope we get it over with it), so let's see if traders

1) VIX Spread – Bullish

The 3-month VIX spread is at +2.6 which indicates that traders are moderately bullish. However, this number has been sliding steadily as traders slowly price in more volatility.

2) CNN Fear & Greed Index – Bearish

The Fear & Greed Index is at 30, down from 53 last week.

F&G operates on a 1-100 scale, and a reading of 30 means traders are bearish.

3) AAII Sentiment – Bearish

The latest AAII Sentiment Survey shows that 35.3% of individual investors are bullish, which is just below the long-term average of 38.5%.

It's close enough to the middle to cal

4) CBOE Equity Put-Call – Bearish

The CBOE Equity-Put Call ratio was at 0.67 yesterday with a 3-day moving average is 0.73. This is indicates that traders are bearish.

5) ISE Sentiment – Neutral

The ISE Sentiment Index is at 101 (101 calls bought for every 100). So there are a ton of post-Fed call buyers. , which is a bullish reading. The 10 day moving average is just 89.7, up from 83 last week.This indicates strong demand for put options, but the ISE has been extraordinarly low forever, and 89.7 is pretty high compared to recent readings.

Conclusion

Out of 5 sentiment indicators, we have:

1 bullish
3 bearish
1 neutral

So in the past 4 weeks we've gone from 2 weeks of bullishness to 2 weeks of neutrality.

Markets have been in a slow motion grind lower since the spike high on Trump's speech, and the sluggishness is impacting traders' moods.

Weekly Sentiment Update: The Bears Are Done Hibernating… and They’re Hungry

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