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| Today's Commentary (Short Term Outlook) |
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Surprisingly, investors
are too bearish Stocks rebounded impressively yesterday, from an early sell-off. The Dow closed up 37-points and the C, S and I-funds gained 0.3%, 0.2%, and 0.8% respectively, after being down about 1% earlier in the day. The I-fund was helped by another weak day for the dollar. The S&P 500 did what the S&P 500 has been doing; staying glued to the rising overhead resistance. Nothing new here.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The TSP Talk Sentiment Survey System, which moved into bull market mode effective August 13, gave its first buy signal since February. The 1.07 to 1 bulls (44%) to bears (41%) ratio is under the 1.25 to 1 bull market rules buy signal ratio.  I wouldn't be surprised if this is a bit premature, as obviously the market has rallied tremendously leading up to this signal, but this market just keeps surprising me. How long the signal lasts, we don't know. Could be a week - could be a year. The AAII Investor Sentiment Survey came in at 37% bulls, 49% bears for a ratio of 0.76 to 1. That is amazingly bearish (bullish for stocks) for a market that refuses to fall.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The last time we saw a bearish percentage as high as 49% in this survey was in early July, just prior to a 150+ point (18%) rally in the S&P. Again, I find this amazing since the S&P is just off the highs. That's all for today. I will leave the September seasonality charts below for your weekend viewing pleasure. Thanks for reading! Have a great weekend and we'll see you back here on Monday. ------------------- Here is some seasonality data for September and the days surrounding the Labor Day holiday weekend. If history repeats, Friday September 4th (day -1 below) would be the best day for stocks. Thing get a little more shaky after the holiday (+1 on after).
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