Bears Lead Bullish Sentiment Lower

The contrarian Sentiment Survey indicator reported by the American Association of Individual Investors, as of December 26, 2007, shows individual investors continue to be bearish.

• The bullish level declined to 30.0% versus last week's 35.9%.

• The 8-period moving average fell to 34.7%. This is the lowest level since August 2006 when the 8-period moving average equaled 34.3%
  

• The level of bearishness increased to 50% versus last week's 47.2%.

• As a result, the bull/bear spread came in at a -20% versus last week's -11%.

In addition to the 7-year chart, I have included a shorter snapshot beginning December, 2005.

(click on charts for larger image)

Source: American Association of Individual Investors