S&P 500 Rally May Persist
US 500: Retail trader data shows 28.3% of traders are net-long with the ratio of traders short to long at 2.54 to 1. The number of traders net-long is 10.2% lower than yesterday and 24.8% lower from last week, while the number of traders net-short is 8.0% higher than yesterday and 8.3% 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