S&P 500 Trend May Reverse Despite Bearish Signal
US 500: Retail trader data shows 38.5% of traders are net-long with the ratio of traders short to long at 1.6 to 1. The number of traders net-long is 4.1% higher than yesterday and 5.6% higher from last week, while the number of traders net-short is 1.7% higher than yesterday and 7.4% lower 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. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current US 500 price trend may soon reverse lower despite the fact traders remain net-short.
--- Written by Dylan Jusino, DailyFX Research