NUMBER OF TRADERS NET-LONG HAS INCREASED BY 27.6% FROM LAST WEEK
US 500: Retail trader data shows 33.7% of traders are net-long with the ratio of traders short to long at 1.96 to 1. In fact, traders have remained net-short since Jan 07 when US 500 traded near 2637.97; price has moved 10.6% higher since then. The percentage of trader’s net-long is now its highest since Jun 04 when US 500 traded near 2807.36. The number of trader’s net-long is 13.1% higher than yesterday and 27.6% higher from last week, while the number of trader’s net-short is 7.0% lower than yesterday and 14.9% lower from last week.
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S&P 500 SENTIMENT SUGGESTS A BULLISH SIGNAL, HOWEVER RECENT CHANGES MAY POINT TO A POTENTIAL REVERSAL 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. The combination of current sentiment and recent changes gives us a stronger US 500-bullish contrarian trading bias.