11/30/09 Stockholm, Sweden – The most recent issue of Investors Intelligence, which analyzes roughly 100 newsletter forecasts, has found that over 50.6 percent of writers are bullish versus 17.6 percent that are bearish. It’s a shocking, multi-year low for bearishness. Typically when newsletters are so widely bullish the opposite outcome is expected to play out in the market.
According to Benzinga, “based on historical probabilities and odds and the market’s regular performance over the course of the then following 20 sessions (regularly 1 month), the multi-year low with respect to the bearish newsletter writers may not be indicative that any kind of top is in, but at least the market shows a (significantly) above-average tendency for trading lower first before any (significant) gains may be achieved, and any year-end rally is not out of question, but may stand on shaky ground.”
Viewed from this perspective, and in terms of timing, here is more reason to be skeptical of how much more steam the rally has in it. For details and tables, see Benzinga’s coverage of Investors Intelligence and expected market performance.
Rocky Vega
Rocky Vega is publisher of Agora Financial International, where he advances the growth of Agora Financial publishing enterprises outside of the US. Previously, he was publisher of The Daily Reckoning, and founding publisher of both UrbanTurf and RFID Update -- which he ran from Brazil, Chile, and Puerto Rico -- as well as associate publisher of FierceFinance. Rocky has an honors MS from the Stockholm School of Economics and an honors BA from Harvard University, where he served on the board of directors for Let’s Go Publications, Harvard Student Agencies, and The Harvard Advocate.
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there will be no market crash in nomical terms…there is way too much money, credit, and debt floating around which has found its way into the equities markets….qe and obama’s voodoo economics makes an equities crash unlikely if not impossible….
on the other hand, measuring the market in terms of nominal pricing is nonsense….the market priced in gold is highly deflated and in collapse….