TSP Talk Sentiment

Their latest poll on the front page shows:

For the coming week 02/25 - 02/29/08, I am...

Ratio
Bullish (up) 28%
Bearish (down) 59%
Neutral 13%

One week is a long time. Might be much lower on Tuesday and much higher on Friday -- ala 1/22-25.

Will this be the 16th or 17th bull signal? While the SPX has lost over 100 points?

Will this be the 16th or 17th bull signal?
While the SPX has lost over 100 points?

I think that when they get really leaning, they're quite predictive. It's just that their system is to Bullishly biased.

In a bear, you get nice bounces out of the sentiment, but you just can't count on it to hold.

See my post below on their system.

Mark

Week S&P 500 S&P 500 Buy/ From: To: Bulls Bears Ratio gain/loss Close Votes Sell 02/25/08 - 02/29/08 28% 53% 0.53 -1 B 02/18/08 - 02/22/08 43% 44% 0.98 -1 319 B 02/11/08 - 02/15/08 31% 56% 0.55 -1 1.40% 1349.99 207 B 02/04/08 - 02/08/08 40% 48% 0.83 -1 -4.60% 1331.29 383 B 01/28/08 - 02/01/08 43% 41% 1.05 -1 4.87% 1395.42 393 B 01/21/08 - 01/25/08 26% 65% 0.40 -1 0.41% 1330.61 395 B 01/14/08 - 01/18/08 34% 52% 0.65 -1 -5.41% 1325.19 360 B 01/07/08 - 01/11/08 35% 53% 0.66 -1 -0.75% 1401.02 417 B 12/31/07 - 01/04/08 43% 43% 1.00 -1 -4.52% 1411.63 332 B 12/24/07 - 12/28/07 41% 43% 0.95 -1 -0.40% 1478.49 393 B 12/17/07 - 12/21/07 43% 42% 1.02 -1 1.12% 1484.46 272 B 12/10/07 - 12/14/07 69% 17% 4.06 -1 -2.44% 1467.95 387 S

Hi Mark,
I agree that extreme s/t leans one way or the other can be good s/t signals.
As you say below:

The big problem, as I see it and as I have commented, is that it's "Bull market biased". Basically, it looks at sentiment the same way in a Bull market as a Bear market.

I think that's true and very important, not only regarding sentiment levels but also every technical measure we have been using the past 6 years.
In a bull market, an indicator will not even be overbought till it gets above 90, but when bearish, 50 may be a top.

"Context is everything" as the Old Hawaiian says.


For example, look at the huge rally we got in 2006 when sentiment dropped below 30%.
But even lower sentiment now has produced next to nothing.

Edited by Rogerdodger, 22 February 2008 - 01:11 PM.

PS: I've only observed sentiment from a distance for about 3 years. So, I always appreciate your input. For a kid, you have lots of wisdom.

I started early. And I FEEL old!