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Crowd Sentiment Points to Further SPX Losses

David Rodriguez

ssi_spx500_body_Picture_15.png, Crowd Sentiment Points to Further SPX Losses

SPX500Clear retail sentiment extremes timed almost the exact top in the S&P 500, and continued retail buying leaves us in favor of further SPX500 losses.

Trade Implications SPX 500Self-congratulation aside, I think there’s scope for further SPX weakness. The fact that our sample shows retail traders at their least-short since December is one reason, but also I think we’re seeing the beginnings of a broader market deleveraging. Stocks, bonds, and even the Dollar might be the worst-performers if this forecast comes to fruition.

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

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