S&P 500 Trader Sentiment Yields A Conflicting Bias
Net-Long and Net-Short Move Away From Extremes
US 500: Retail trader data shows 34.9% of traders are net-long with the ratio of traders short to long at 1.87 to 1. In fact, traders have remained net-short since May 03 when US 500 traded near 2658.63; price has moved 9.3% higher since then. The number of traders net-long is 4.9% lower than yesterday and 3.8% higher from last week, while the number of traders net-short is 0.6% lower than yesterday and 8.0% lower from last week.
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Current Sentiment Gives A Mixed Trading Bias
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests US 500 prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed US 500 trading bias.
--- Written by Jack Schwarze, DailyFX Research