Thursday, December 23, 2010

Bullish Investor Sentiment Increases 13 Points

This week's release of the American Association of Individual Investors weekly sentiment survey shows bullish sentiment increased over 13 percentage points to 63.28%. This is the highest level the bullishiness reading has reached since November 18, 2004. Shortly after the November 2004 period, the 8-period moving average reached almost 57% and the market experienced a small correction of about 3%.

From The Blog of HORAN Capital Advisors

As regular reader of this blog know, the investor sentiment reading is a contrarian indicator. As a result increasingly higher bullishness readings are one factor to consider when evaluating whether or not the market is overbought. The 8-period moving average does smooth the volatility that is associated with the weekly sentiment figures.

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