That's a Lot of Bull
by
, 12-12-2009 at 09:30 AM (1324 Views)
The good news is that had another positive close Friday. The bad news is that sentiment continues to be highly bullish. Typically, that's a warning for the stock market. We've been bulled up in numerous pockets for at least a week now, and next week looks to be shaping up the same way.
Last week our TSPTalk sentiment survey had 58% bulls to 28% bears
This coming week:
62% bulls to 28% bears
Then we have Investor's Intelligence showing over 48% bulls after last week's 50% bulls:
Tickersense was split about 37% bulls to 37% bears.
RealMoney looks like our survey with 61% bulls to 28% bears.
Trader's Talk is currently showing over 58% bulls to 29% bears for Monday's trading.
Overall, that's a lot of bull, so if we have a pre-Christmas sell-off we'll know why.
Many traders thought the sell-off would have come last week and that we'd rally next week, but that wasn't the case. However, as we get closer to the holidays volume will drop off and that bullish bias could push this market higher, assuming a sell-off doesn't happen. But the charts are still wound up tight in a very narrow range, so the odds still favor lower prices before we move higher. This coming week will probably tell the story. Here's Friday's charts:
One sell and three buys, but not much movement here.
One sell and two buys here, and again not much movement.
Our Top 25% continue to hold steady and these charts show how they are positioned for Monday's trading.
So the Seven Sentinels remain on a buy with 5 of 7 buys signals. But as I've already mentioned, sentiment is not giving us a good set-up for a rally. I'm hoping market volume begins to dry up now so that the bullish bias can push prices higher, but I'm not counting on it until after this week's trading. If we see a sell-off, it'll probably come this week. I'm watching Trader's Talk carefully, their survey only has about half the normal votes, but they have till Monday's open to vote, so it can still change. But if it stays North of 50% bulls, I'm looking for some selling to begin the week.