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| Today's Commentary (Short Term Outlook) |
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Smart money getting
nervous Stocks opened sharply lower yesterday after the Asian markets struggled overnight because of the trade concerns with China, but by the close the U.S. major indices all closed higher.  The TSP's C and S funds were up but the I-fund lost ground because the U.S. rally came late yesterday, and the dollar was stronger early in the day. Because of that, unless the U.S. markets sell-off, the I-fund should see a nice day today. The S&P 500 also closed near the highs of the day and it continues to test the overhead resistance. I keep giving the bull market the benefit of the doubt, but in the short-term it looks like there is more risk to the downside, than potential on the upside. I can see 1060 on the upside, but possibly 990-1000 on the downside.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The PMO did trigger a buy signal as the indicator moved ahead of its 10-day exponential moving average (EMA). Last week we looked at several dumb money sentiment surveys, which were giving us some mixed signals. Some were overly bullish, some overly bearish and another neutral. Today we'll take a look at a smart money survey, the Wall Street Sentiment Survey. They came in at 22% bullish and 72% bearish. This indicator can move dramatically from week to week, but this 0.31 to bull to bear ratio is very bearish, and since it is supposed to represent smart money, it is a bearish reading for stocks, at least for the next week or so.  Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The last time we saw a 72% or higher bearish percentage was in June as the market was puting in a temporary top. I'm thinking if the market can hang tough this week, an options expiration week, next week could be a good time to take something off the table; looking for a dip to buy at another time. We'll see how it plays out. That's all for today. Thanks for reading! See you back here tomorrow. |