Mid-Week Market Sentiment Update

A quick look across the landscape on OPEC/Oil hype day in the global markets.

Public optimism in oil was already turning up pre-OPEC.  A production cut would get everybody lathered apparently, because rising prices are bullish after all.  I pre-bought our heating oil at cheap prices this winter, so bring it on I guess.  I am neutral on oil but a big surge from this hype could tilt it bearish.  From Sentimentrader.com

crude oil optimism index

Gold Optimism Index is heading in the right direction as formerly over bullish momos reverse their bad behaviors.  You buy the gold sector when it is despised, not when it is touted.  While bounces will happen, the trend is now down and sentiment needs to be completely washed out before a long-term buy is in place.

gold optix

Over in broad stocks, pessimism is all gone.  Bye bye angst, fear and worry!  Buy buy the stock market!  Don’t misinterpret me, the stock market is bullish with a capital ‘B’.  But a condition is coming into place for a contrary setup.  These things take time to play out and in the meantime, I am well positioned and making sure to take profits and re-seed into other items on opportunities.  It could be a big game of a macro Musical Chairs.

indicatorsindicators

Meanwhile, newsletter writers are still in the process of washing the bear stink off of themselves and getting with the program.  The average letter writer after all, will not remain in business if he dares fight the trend for too long.  That is why as a group, they are trend followers.  There is still a contingent of plucky bears in the mix, but this indicator is steaming to over bullish.  From Yardeni.com

investors intelligence

Finally, the group that we have been looking at very closely of late, the AAII.  Boink!  The little guy is getting back in the game after all these years and he’s ready to make some coin.

aaii

Here is the historical we have been using for perspective on the AAII’s history as a former and potentially once again contrary indicator.

aaii

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