coolhand's Account Talk

[tsptalk]

Same with AAII, so this week's AAII survey, which ends at noon on Wednesday's, was over before the Fed decision.

 

[coolhand]

Of course, changes in sentiment can occur at any time in between readings. We have no way of really knowing. We also have the spending bill drama unolding.

 

[WorkFE]

We also have the spending bill drama unfolding.

Which I thought would have a bigger negative effect on today. Of course there are 2 hours to go.

 

[coolhand]

The markets are in turmoil in the premarket. While NAAIM sentiment was bullish in the latest reading, economic conditions can change quickly and sentiment can shift as a result. There is an expectation for a Santa rally, but it is not a lock. Fact is, there is a lot going on domestically and internationally and I am pretty certain it's going to get crazy in the weeks ahead (not that it isn't already). Stay aware of market indicators and be willing to make adjustments to personal expectations. It is not my intent to sound bearish, but conditions are such that caution is warranted. What is your risk tolerance? Only you can answer that. I wish everyone the best.

 

[coolhand]

This week's NAAIM reading shows the mean average dipping a bit more than 2 pts. That keeps it bullish. Last week, the bears were fully short, but not leveraged. This week the bears are fully short AND leveraged. The bulls remain fully long and leveraged. So, the bears are looking to capture some gains on the short side, but given the reading remains bullish any downside may remain limited.

 

[coolhand]

Happy New Year to all! This week's NAAIM reading shows the mean average dropping more than 16 pts. This is the 4th week in a row that the average has fallen, but this time the reading flips from bullish to neutral. The bears are fully short and leveraged just like last week, but there are more of them this week. The bulls remain fully long and leveraged. So, this reading suggests we could see some volatility over the days ahead. The market is rallying early on, but where will it be later in the day and subsequent days?

 

[coolhand]

This week's NAAIM reading did not change much. The mean average rose a little more than a point. It remains neutral to my eye. Last week, the bears were fully short and leveraged. This week, the bears remain fully short, but took off the leverage, so they aren't as committed to the short side this week. The bulls remain fully long and leveraged. This reading remains mixed, so the market may also remain a mixed bag. Some measure of volatility could develop over the days ahead.

 

[coolhand]

The week's NAAIM reading moved up by almost 5 pts. That takes the mean average from neutral to "modestly" bullish. There is only modest shuffling in the numbers themselves. The bears remain fully short (no leverage) and the bulls remain fully long and fully leveraged. While the reading is modestly bullish, I suspect these money managers are not complacent at all; especially with the new administration taking over next week. Things are going to change in more ways than we can count as the new admin rolls out what I expect will amount to a whole new paradigm of Government efficiency measures. Don't fall asleep. Things are very likely going to get progressively more "interesting" (or you can insert your own word(s) here).

 

[coolhand]

This week's NAAIM reading moved higher by almost 16 pts, which puts it back into a bullish posture. The bears have no short positions, so it would seem downside risk has dropped off for now. The bulls remain fully long and leveraged.

 

[tsptalk]

Nice! I'm a little surprised.

 

[rangerray]

It’s because they know more than we know.


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[coolhand]

Okay, we have some movement this week in the NAAIM mean average. The average fell about 18 pts. That puts the reading between neutral to modestly bullish. The bears went from zero short positions last week to fully short and fully leveraged this week. This suggests some degree of volatility could present itself. Given the nature of the financial news and the ongoing implementation of a new administration, I suspect we will see an increase in news driven financial movement moving forward. That's where the volatility may come in. This is neither a bearish or bullish outlook, it is only a reason to be alert for any changes in market behavior down the road.