S&P 500 May Rally As Traders Are Further Short
US 500: Retail trader data shows 17.0% of traders are net-long with the ratio of traders short to long at 4.87 to 1. The number of traders net-long is 12.1% lower than yesterday and 2.2% lower from last week, while the number of traders net-short is 2.6% higher than yesterday and 2.3% higher from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests US 500 prices may continue to rise. Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger US 500-bullish contrarian trading bias.
--- Written by Dylan Jusino, DailyFX Research
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