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Enron Mail |
Results of the Fearless Forecaster Sentiment Poll taken after the close on 1/11
Response was to this question: "At the end of next week will the S & P 500 close up (bull), down (bear), or unchanged/no opinion (neutral)?" IT BULLS: 31% IT BEARS: 58% Our `Smart Money' Poll was 100% Bearish. The Senticator is Bullish. Last week, we said that sentiment was suggesting that we had a top coming last week. We came right out and called it-- a top for last week, "Probably before Wednesday." We nailed it, and we're going to take credit for it. We know it was a tough one to trade, because we were shorting it too, but we as accurate as one can get in a weekly report. Going forward, however, may not be so easy for us. This week, the Fearless Forecasters are heavily Bearish, and the "Smart Money" Guys are 100% Bearish, so we have to favor some weakness, at least early. That said, we ought not forget the Senticator. It's Bullish. Next week is options expiration, so if we get some weakness early, and it's met with excessive put buying or other signs of pessimism, we'd expect some sort of rally by or into Friday. We'll try to fine tune this for our regular subscribers by watching the VIX and Rydex Ratios. Big picture, we believe the recent dead-even Bull and Bear readings from the Fearless Forecasters, as well as the AAII and Investors Intelligence sentiment readings indicate that a Top of Intermediate Proportions is either in, or about to come in. Mark Young See www.Traders-Talk.com in the Market Analysis area for a historical chart of the FF sentiment. ABOUT SENTIMENT AND ANALYSIS The Fearless Forecaster Sentiment Poll is taken each Friday from a generally static pool of experienced technical analysts (both private and professional). The Fearless Forecaster Sentiment is not normally a good fade, though there are times when it can be. The Fearless Forecaster sentiment data is useful on the short term; the Fearless Forecasters tend to be right. Typically they are right sooner rather than later, if there's a large plurality. On the flip side of the equation, if 90% or more are Bullish or Bearish, the odds of them being right over the very short term are huge, but the odds of a major turn (in the opposite direction) soon thereafter are also quite good. We have also found that when the Fearless Forecasters are evenly split, look for a BIG move in either direction, but usually down. Over the years, we have found a number of other tools to help in evaluating the Fearless Forecaster Sentiment. We publish this in our weekly "Institutional Sentiment & Analysis" (a part of our institutional research). These additional tools are our "Smart Money" poll, and our Senticator. Both are proprietary polls run by us. We have found that the Senticator tends to be right by the end of the week (as much as 87% of the time), though it tends to be more accurate in a rising market than a falling one. The "Smart Money" pollees are very useful when there is divergent opinion. It's generally NOT a good idea to fade the "Smart Money" unless "'EVERYONE'" (all sentiment measures) is in agreement. When in doubt about the meaning of the Fearless Forecaster Sentiment Poll, defer to the "Smart Money" poll. The "Smart Money" guys are folks with whom I've worked or whom I've watched for YEARS. They all have different approaches and they're all VERY good (not infallible, just good analysts/traders). http://www.decisionpoint.com/affiliate/0ffsi.GIF
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