Anecdotal evidence suggests a market bottom on St. Patrick's Day. Several turning points occurred on that day in the past (especially 2000 & 2003), and this year's bear market may be setting itself up for another inflection point.
More...Bloomberg reports a contrarian indicator...
“The American Association of Individual Investors said 70.27 percent of investors were bearish as of yesterday. That’s the highest reading since the index’s creation in 1987.
The AAII index measures sentiment on U.S. stocks for the next six months among individual investors. Its prior peak of 67 percent was set in October 1990, when the S&P 500 closed at 305.74. The stock benchmark then surged fivefold through 2000.
“When emotions get to one extreme, you get a counter-trend move,” said Peter Boockvar, an equity strategist at Miller Tabak & Co. in New York. “Today, it’s very much at an extreme. It tells you that you’re closer to a bounce than not.”
4 comments:
Early into the Friday am trade it looks like Peter Boockvar nailed it.
CBOE Gold Index has formed a nice looking inverse head & shoulders pattern. Breakout level is around 160. Continuous contract and the ETFs are a little less ordered but have the same basic formation.
Kumbu, care to elaborate on the inverse head & shoulders pattern? Deb
More on the inverse H&S bottom on the GOX. Click the image to get better resolution.
Post a Comment