Can it be this easy?

Can being in stocks right now be this easy?  Obviously not for those of us on the sidelines but doesn't it seem like everybody, save present company, is bullish?  That's not usually healthy for the short term.  Just don't tell the market that.  It seems to be on autopilot.

You know how we talk about investor sentiment?  We have the AAII Investor Sentiment Survey which we call the "dumb money".  It usually pays to go against the extreme readings of this survey.  Then we have the Wall Street Sentiment Survey which can be considered the "smart money".  This is an active bunch and tend to be more accurate in their market sentiment.

Then there is the lowrisk.com survey.  I mentioned this survey a few times but I don't follow it very closely.  It is a herd type survey which puts it in the "dumb money" category. 

Lets' take a look at the lowest bearish readings at lowrisk.com over the last eight years.  That's over 400 weeks.

From lowrisk.com

Date	Avg Dow Guess	Bullish	Bearish	Neutral
8/10/1997	8236	66.00%	11.30%	22.60%
4/5/1998	8983	64.20%	11.30%	24.50%
12/21/1997	8012	49.00%	13.70%	37.30%
7/20/1997	7981	57.10%	14.30%	28.60%
7/13/1997	7896	52.20%	15.20%	32.60%
10/5/1997	8051	62.50%	15.60%	21.90%
7/27/1997	8022	58.00%	17.10%	24.90%
11/21/1999	10972	53.70%	17.10%	29.30%
12/19/2004	10701	42.90%	17.10%	40.00%
6/8/1997	7402	51.70%	17.20%	31.00%
12/13/1998	8999	47.10%	17.60%	35.30%
7/9/2000	10757	76.50%	17.60%	5.90%
1/4/1998	7988	56.40%	17.90%	25.60%
7/12/1998	9166	48.80%	18.60%	32.60%
6/28/1998	8994	61.10%	19.40%	19.40%
3/14/1999	9942	58.70%	19.60%	21.70%

These sixteen weeks listed are the surveys where the bearish percentage went below 20%.  The lowest readings were in the 11% range back in 1997 and 1998.  The 1997 11.30% reading preceded a five day 4% drop and a one month consolidation.  The 1998 11.30% came just before a 2% drop and three months of sideways action.

So why do I bring this up?  This week's reading was (are you sitting?) 0% bears.
 

11/20
Bullish	79%
Bearish	0%
Neutral	21%
DJIA Median Guess	10705

Zero!  None!  79% were bullish and 21% neutral.  It's never happened before so we don't even know exactly what to expect.  Judging by the other figures and the period in which it happened, I suspect this means the market is capable of some big gains, AFTER a period of consolidation.  In 1997 the S&P 500 ended up 33%, 1998 was up 22% and 1999 up 21%.  These are the type of numbers I am looking for for 2006, 2007 and possibly 2008.  Now let's get the pullback out of the way so we can get back into stocks. 

I had considered joining in on the seasonality strength for Wednesday and Friday if the market pulled back at all Monday and Tuesday.  It obviously didn't so I just couldn't jump in.  Too risky for me at this point.

Enjoy your Thanksgiving!  Depending on what happens Wednesday, I may or may not have an update Friday.  The market will close early Friday but you should be able to make transfers. 

That's all for today.  Currently 100% G fund.   Thanks for reading.  See you tomorrow.