Sentiment readings were very bullish across a range of indicators this week. To begin, Investors Intelligence Advisor Sentiment had its highest percentage of bulls (58.8) since the October 2007 market top. The American Association of Individual Investors poll had the highest percentage of bulls (63) since October 2004, and the lowest percentage of bears (16) since October 2005. Finally, the National Association of Active Investment Managers (NAAIM) shows that on average they are 81.83% invested. Market Vane posted a 75% bulls for Nasdaq reading last
week the highs since the 2007 top. This is in the high end of the ranges of these surveys and shows that these managers are quite bullish.
The put call levels have run in the 70's for the last three weeks on the CBOE that is extreme also. Volume is very light and open interest is also contracting so not allot of good news on the sentiment front. I have no desire to buy equities right now. It's defense mode selling into the rallies. The clear lack of volume and sentiment is overtly bullish. The market is trying to stay together into the last day of the year. December 31st to January 3rd looks to be the time frame of the short term top. 1230.50 is the massive support area.
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