Weekly S&P500 ChartStorm - Sentiment is increasingly consensus bullish
Learnings and conclusions from this week’s charts: $S&P 500(.SPX)$ $SPDR S&P 500 ETF Trust(SPY)$ $NASDAQ(.IXIC)$ $Invesco QQQ Trust-ETF(QQQ)$ $Nasdaq100 Bull 3X ETF(TQQQ)$ $Nasdaq100 Bear 3X ETF(SQQQ)$ $NASDAQ 100(NDX)$ $DJIA(.DJI)$ $GLOBAL X DOW 30® COVERED CALL ETF(DJIA)$
Sentiment is increasingly consensus bullish.
Bears have all but gone extinct.
Large and small investors alike are basically all-in.
Tech stock valuations have surpassed the 2021 peak.
Downside volatility has collapsed (typical in bull markets).
Overall, the evidence is all consistent with what you typically see during a bull market; sentiment is bullish, investors are on the bandwagon, earnings expectations are running high, valuations show unbridled optimism, downside volatility is in a state of soothing calm.
These are the types of dynamics that can form self-reinforcing feedback loops launching into bubble-like conditions. But in this strength is also a form of fragility — if a reason ever rises to doubt the bull case, there are a lot of minds that could change.
1. Bulls and Bears
This pair of charts shows the path of bulls and bears in the AAII and II surveys (longest running sentiment surveys) — they show at once, how the current cyclical bull market emerged (from the previous collapse in bullishness and surge to rare heights in bearishness)… but also the current state of things: despite a vocal minority, most people are bullish, and bears are gone.
2. Consensus Bulls
The Consensus Inc. Bullish Sentiment Index — known by practitioners as “Consensus Bulls”, pretty much says it all in that name. Almost 80% of market analysts surveyed by Consensus Inc. are bullish.
3. Small Big Bulls
Small speculators in stock index futures have reached their most bullish net position ever. Consistent with the previous survey charts.
4. Big Money Big Bulls
Larger investors are also going with the bullish flow — BofA Fund Manager survey shows allocations to US equities is now at the highest level since Nov 2021.
5. Tech Supreme
Tech stocks have broken out to an all-time high relative to the S&P 500 — not to jinx it, but that looks like the establishment of a new permanently higher plateau for tech stocks!
6. Tech Value
US tech stock valuations have now surpassed the 2021 highs in both absolute terms (vs their own history) and relative terms (vs the rest of the market).
7. Highly Valuable Sales
Investors are happy to pay a premium for sales because of elevated profit margins, and because of narratives and perceptions that sales will surge higher evermore.
8. Earnings Growth Enthusiasm
Another angle on that — long-term earnings growth forecasts are surging once again as the AI era emerges.
https://www.chartstorm.info/p/weekly-s-and-p500-chartstorm-24-mar
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Great article, would you like to share it?
Great ariticle, would you like to share it?
Great article, would you like to share it?
Great article, would you like to share it?