hotwings
Member
Just found this read....thoughts?
https://financestrategysystem.com/naaim-exposure-index/
https://financestrategysystem.com/naaim-exposure-index/
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coolhand's Account Talk
- Thread starter coolhand
- Start date
coolhand
Well-known member
I don't agree with their premise that this is a contrarian indicator except in very short time frames. In fact, if anyone followed that advice when these managers were long (for years) they would have done poorly.
Smart money is generally never contrarian.
It should also be pointed out that this sentiment reading should not be used all by itself. Other indicators should be used to help validate a market perspective.
Smart money is generally never contrarian.
It should also be pointed out that this sentiment reading should not be used all by itself. Other indicators should be used to help validate a market perspective.
nnuut
Moderator | TSP Legend
Coolhand
I'm sorry for the stupid question but how do you read the NAAIM to tell if they are bullish or bearish. Am I to look at the trend i.e the last report based on the link Nnuut provided shows it moving down on the 6th but is one to say that anything above a 50, they are still bullish but trending down. Any help you may have to help understand how to read it would be greatly appreciated.
coolhand
Well-known member
Here is a chart from the NAAIM website where they plot the NAAIM Number. I suspect that the numbers on the left side of the chart can go negative or more positive than what is shown, but that doesn't generally happen. Let's say that 60 is neutral (which it is on this chart). The further above that neutral line the number goes, the more bullish the reading. By the same token, the further lower that the number goes below the neutral line, the more bearish the reading.
For anyone reading this, don't over-analyze the reading. There is some subjectively involved. All you are trying to do is get a sense of how the smart money is positioned overall. Are they collectively bullish, bearish or somewhere in between?
My personal perspective on how I read the weekly NAAIM reading is also shaped by other data that changes week to week (not dramatically), but be aware that I have been using NAAIM for probably 10 years now and nothing takes the place of experience.
coolhand
Well-known member
The bulls had a very good week last week, especially if you were exposed to the S Fund. We have not hit a higher high yet, but the market is not far from making one if the rally continues on this up-leg. No doubt, many cannot fathom how this market continues to defy gravity given the headlines. Kinda makes you want to through out fundamentals altogether, doesn't it?
The up-trend remains firmly in place, but there resistance above at the 200 dma.
Breadth remains bullish.
TSP Talk sentiment came in neutral. NAAIM is leaning bullish.
I remain bullish.
The up-trend remains firmly in place, but there resistance above at the 200 dma.
Breadth remains bullish.
TSP Talk sentiment came in neutral. NAAIM is leaning bullish.
I remain bullish.
coolhand
Well-known member
The bears tried to get something going today, but the bulls would have none of it as the market started out the trading day weak, but finished near the neutral line.
We do have some resistance on both charts near the highs. The 200 dma is not far above, which may present more resistance should it get tested. I have a strong hunch price will eventually push past that key average, but I'm not making any predictions.
Breadth remains bullish.
As I've mentioned in the past, I suspect there is a floor under this market. If I am correct, the bears are in trouble and the uptrend should continue over time.
I remain bullish.
We do have some resistance on both charts near the highs. The 200 dma is not far above, which may present more resistance should it get tested. I have a strong hunch price will eventually push past that key average, but I'm not making any predictions.
Breadth remains bullish.
As I've mentioned in the past, I suspect there is a floor under this market. If I am correct, the bears are in trouble and the uptrend should continue over time.
I remain bullish.
coolhand
Well-known member
It was the bears turn to turn the market around today as the market started off in positive territory, but eventually succumbed to heavy selling pressure in afternoon trade.
Overall, there is still no damage to the uptrend, but we do have resistance at the current peak.
Breadth is looking rather neutral now.
It may not be an easy road for the bulls to take this market higher, but easy or not I still believe it will be heading higher.
I remain bullish.
Overall, there is still no damage to the uptrend, but we do have resistance at the current peak.
Breadth is looking rather neutral now.
It may not be an easy road for the bulls to take this market higher, but easy or not I still believe it will be heading higher.
I remain bullish.
coolhand
Well-known member
The bears are certainly letting the bulls know that they are not just simply going to go away. The markets fell again today with price now testing support near the last low.
Price does remain above the 50 dma, so that's a plus for the bulls. The bulls do need to turn price back up for another run at the 200 dma or risk additional selling with a possible test of the 50 dma first. Momentum is turning down.
Breadth has flipped negative.
I didn't think it would easy for the rally to go unchallenged and it isn't. NAAIM reports tomorrow and that will really help shape expectations for the next few days.
I remain bullish, but support needs to hold.
Price does remain above the 50 dma, so that's a plus for the bulls. The bulls do need to turn price back up for another run at the 200 dma or risk additional selling with a possible test of the 50 dma first. Momentum is turning down.
Breadth has flipped negative.
I didn't think it would easy for the rally to go unchallenged and it isn't. NAAIM reports tomorrow and that will really help shape expectations for the next few days.
I remain bullish, but support needs to hold.
coolhand
Well-known member
So, what's going on with the selling? POTUS made a comment yesterday about the "rich guys" betting against the stock market. When POTUS makes public comments, they are not idle statements. The stock market is at times a major target of big money for the purpose of using it as a form of psychological optics in the never ending political war between good and evil.
https://www.cnbc.com/2020/05/13/trump-warns-rich-guys-could-be-talking-down-stock-market-to-profit.html
https://www.cnbc.com/2020/05/13/trump-warns-rich-guys-could-be-talking-down-stock-market-to-profit.html
rangerray
Active member
I think it's all momentum based selling. A few of these guys make the comments (who have everything to gain), then the media follows with bold headlines that read THE SELL-OFF CONTINUES! Then the typical small-time investor, much like me, says, "Holy crap! I better sell everything. It's the end of the world!" The billionaires then just sit back and pour another bourbon.
coolhand
Well-known member
NAAIM came in a bit less bullish, which makes it 2 weeks in a row that they slowly moved toward neutral from a moderately bullish stance. So, they are now neutral. This tells me that the smart money is well aware of the battle for control of price and that because they are neutral, they are taking both short and long positions. We may be in for some volatility.
coolhand
Well-known member
We are heading toward not just an economic recovery, but a whole new world paradigm (not the NWO). The next few years are going to be epic (biblical).
coolhand
Well-known member
The bears tried to press their downside pressure, but the bulls finally stepped in and drove price back into positive territory.
The 50 dma did not get tested, but close may be enough. I suspect a bottom is in for the moment, but the battle is likely to continue over the days ahead.
Breadth remains negative.
NAAIM came in neutral, which I think bodes for continued back and forth action. They are neither bullish or bearish, so I am not looking for major moves in either direction at this time.
I think the bulls may apply more upside pressure in the short term, but I am now leaning neutral overall.
The 50 dma did not get tested, but close may be enough. I suspect a bottom is in for the moment, but the battle is likely to continue over the days ahead.
Breadth remains negative.
NAAIM came in neutral, which I think bodes for continued back and forth action. They are neither bullish or bearish, so I am not looking for major moves in either direction at this time.
I think the bulls may apply more upside pressure in the short term, but I am now leaning neutral overall.
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