S&P 500 Climbs as Sentiment Provides Bearish Bias
Net-Long Positions Climb to New Weekly Highs
US 500: Retail trader data shows 45.1% of traders are net-long with the ratio of traders short to long at 1.22 to 1. In fact, traders have remained net-short since May 03 when US 500 traded near 2674.15; price has moved 1.1% higher since then. The number of traders net-long is 4.1% higher than yesterday and 15.3% higher from last week, while the number of traders net-short is 1.7% higher than yesterday and 10.5% lower from last week.
S&P 500 May Soon Reverse Lower
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 Yayati Tanwar, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.