Another Large Decline In Bullish Sentiment

Today, the American Association of Individual Investors reported another large decline in investor bullishness. The bullish sentiment reading of 31.25% is the lowest level reported since the July 20, 2006 reading of 23.85%. Is it possible the market is setting itself up for a year end rally? The Fed meets next week and is likely to lower the Fed Funds rate again, mutual fund window dressing will be completed by the end of the month, and the market has gone through a corrective phase over the last several weeks.

(click on chart/table for larger image)

Data Source: American Association of Individual Investors