CNBC is citing some survey which says the general public is bearish on this market. QE has created income inequality. The top 1% is doing extremely well. The bottom 80% is still in recession.
"CNBC is citing some survey which says the general public is bearish on this market."
As compelling as 'some survey' sounds, I'm going to stick to the countless other indicators with years of available data.
btw, the survey in question is an AP poll. What did this poll say in 2007? The answer is they didn't do one. They did one in late 2008 when the S&P had 25% and about half a year of downside left: the crowd was bearish. After the lows in 2009: the crowd was bearish. In the current poll, 4 years of gains later, they're bearish. Want to bet in 2007 they would've been bearish? I do.
Incidentally, this survey also says "Overall, 20 percent of investors say they plan to invest more heavily in the market in the coming year, 22 percent will pull back, and 57 percent plan to invest at about the same level as in 2013."
Phenomenal, thanks as usual aapljack. If the immediate past is a good frame of reference, we had a 42% spread in April 2011 - it was about 3 months before the market finally toppled over 20%. We also had a 40%+ spread in July '07. Three months later in October the market topped. You know what that 3-month "II rule" aligns nearly perfectly with? The 6-month rule for the TIME cover.
Incredible, Dez. And worth noting that by April, 2011 and July, 2007 the market had basically made their highs. They had very near term and material drops, then rallied back to the vicinity of the highs, then rolled. May 2, 2011, was the Bin Laden top. July, 2007 was the Bear Sterns subprime collapse top.
One note on my trading - I put in my own basket of miners (NG, AU, NEM, BVN, and the aapljack -special PAAS) for the first time in my long/short portfolio today. Right now they're about 10% of the book. I admit that I am at a loss whether we are at a bottom with these guys or not as my bottom-call from the summer has now been invalidated, it may not happen until later in the year after tax-loss selling as you suggest. However, I'm willing to press up to 30% if they continue dropping.
While the VIX has risen for 8 straight days, the further out VIX expiries have barely budged. That's after 5 straight S&P down days. Usually a VIX spike isn't over until the whole curve is jolted. The lack of movement of the VIX 3 months out says more about complacency, imo, than the spot VIX spike says about fear.