S&P 500 Shows Signs of Exhaustion, but it Remains a Buy
Why and how do we use the SSI in trading? View our video and download the free indicator here
US S&P 500– Aggressive retail selling of the SPX500, which tracks the fair value of S&P 500 futures prices, acts as strong contrarian signal that the US equity index will likely continue higher through the foreseeable future. Our data shows 78 percent of all open trades in our sample remain short.
It’s important to note that such one-sided sentiment readings often coincide with key turning points in prices, and we can’t rule out the possibility that the S&P 500 may have set an important short-term high. Until sentiment turns, however, we see no reason to abandon our long-standing bullish trading bias.
See next currency section: EURUSD - Euro May Finally Break Higher
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up for his distribution list via this link.
Contact David via Twitter at http://www.twitter.com/DRodriguezFX