A Look at the Latest Investors Intelligence Survey
By
Rennie on Monday, June 15th, 2009 at 3:16 am
The latest sentiment survey from Investors Intelligence finds less than 25% of newsletter writers polled with a bearish bias, the first reading under 25% in over a year. From a contrarian perspective, that’s a generally negative sign longer-term, although it can be a bit early in terms of timing. When newsletters are complacent, market performance is typically subpar. It’s when they’re largely bearish that buying becomes a much more reliable proposition. See this equity curve comparison chart for an illustration.The table below provides a look at how the S&P has performed when fewer than 1/4 of newsletter writers polled fell into the bearish camp. The table begins with the date when the Bearish Consensus fell below 25%, followed by the date when it rose back over 25% and the performance of the S&P in this time frame…
Investors Intelligence Bearish Consensus Falls Below 25%
06/12/09 – ??/??/??… S&P500 ???
12/21/07 – 01/11/08… S&P500 -5.6%
10/12/07 – 11/16/07… S&P500 -6.6%
05/04/07 – 08/03/07… S&P500 -4.8%
11/17/06 – 03/09/07… S&P500 +0.1%
04/13/06 – 04/21/06… S&P500 +1.7%
11/11/05 – 01/27/06… S&P500 +4.0%
06/10/05 – 08/26/05… S&P500 +0.6%
02/11/05 – 03/24/05… S&P500 -2.8%
11/05/04 – 02/04/05… S&P500 +3.2%
09/17/04 – 10/29/04… S&P500 +0.2%
06/04/04 – 08/20/04… S&P500 -2.2%
05/09/03 – 05/14/04… S&P500 +17.4% (*)
12/13/02 – 12/20/02… S&P500 +0.7%
11/22/02 – 12/06/02… S&P500 -2.0%
01/11/02 – 02/01/02… S&P500 -2.0%
09/10/01 – 09/21/01… S&P500 -11.6%
07/20/01 – 08/03/01… S&P500 +0.3%
07/30/99 – 08/06/99… S&P500 -2.1%
06/18/99 – 06/25/99… S&P500 -2.1%
07/17/98 – 07/31/98… S&P500 -5.6%
04/03/98 – 05/15/98… S&P500 -1.2%
04/03/92 – 04/10/92… S&P500 +0.7%
01/24/92 – 03/20/92… S&P500 -1.0%
06/28/91 – 07/05/91… S&P500 +0.8%
03/22/91 – 05/10/91… S&P500 +2.3%
10/16/87 – 10/23/87… S&P500 -12.3%
06/26/87 – 09/18/87… S&P500 +2.5%
01/16/87 – 05/29/87… S&P500 +9.0% (*)
12/12/86 – 12/26/86… S&P500 -0.2%
11/21/86 – 12/05/86… S&P500 +2.2%
Note that the market was just as likely to trade higher or lower in this time frame, meaning it’s not an actionable signal on its own. But in the vast majority of cases, the market entered into a difficult, choppy period over the longer-term, appearing to break out only to return to its trading range. In only two of the last thirty cases was the S&P able to end up more than 4% when the Bearish Consensus was running at such low levels. This implies a potential area of longer-term resistance in the SPX 975-1000 area.
A Look at the Latest Investors Intelligence Survey
By Rennie on Monday, June 15th, 2009 at 3:16 amThe latest sentiment survey from Investors Intelligence finds less than 25% of newsletter writers polled with a bearish bias, the first reading under 25% in over a year. From a contrarian perspective, that’s a generally negative sign longer-term, although it can be a bit early in terms of timing. When newsletters are complacent, market performance is typically subpar. It’s when they’re largely bearish that buying becomes a much more reliable proposition. See this equity curve comparison chart for an illustration.The table below provides a look at how the S&P has performed when fewer than 1/4 of newsletter writers polled fell into the bearish camp. The table begins with the date when the Bearish Consensus fell below 25%, followed by the date when it rose back over 25% and the performance of the S&P in this time frame…
Investors Intelligence Bearish Consensus Falls Below 25%
06/12/09 – ??/??/??… S&P500 ???
12/21/07 – 01/11/08… S&P500 -5.6%
10/12/07 – 11/16/07… S&P500 -6.6%
05/04/07 – 08/03/07… S&P500 -4.8%
11/17/06 – 03/09/07… S&P500 +0.1%
04/13/06 – 04/21/06… S&P500 +1.7%
11/11/05 – 01/27/06… S&P500 +4.0%
06/10/05 – 08/26/05… S&P500 +0.6%
02/11/05 – 03/24/05… S&P500 -2.8%
11/05/04 – 02/04/05… S&P500 +3.2%
09/17/04 – 10/29/04… S&P500 +0.2%
06/04/04 – 08/20/04… S&P500 -2.2%
05/09/03 – 05/14/04… S&P500 +17.4% (*)
12/13/02 – 12/20/02… S&P500 +0.7%
11/22/02 – 12/06/02… S&P500 -2.0%
01/11/02 – 02/01/02… S&P500 -2.0%
09/10/01 – 09/21/01… S&P500 -11.6%
07/20/01 – 08/03/01… S&P500 +0.3%
07/30/99 – 08/06/99… S&P500 -2.1%
06/18/99 – 06/25/99… S&P500 -2.1%
07/17/98 – 07/31/98… S&P500 -5.6%
04/03/98 – 05/15/98… S&P500 -1.2%
04/03/92 – 04/10/92… S&P500 +0.7%
01/24/92 – 03/20/92… S&P500 -1.0%
06/28/91 – 07/05/91… S&P500 +0.8%
03/22/91 – 05/10/91… S&P500 +2.3%
10/16/87 – 10/23/87… S&P500 -12.3%
06/26/87 – 09/18/87… S&P500 +2.5%
01/16/87 – 05/29/87… S&P500 +9.0% (*)
12/12/86 – 12/26/86… S&P500 -0.2%
11/21/86 – 12/05/86… S&P500 +2.2%
Note that the market was just as likely to trade higher or lower in this time frame, meaning it’s not an actionable signal on its own. But in the vast majority of cases, the market entered into a difficult, choppy period over the longer-term, appearing to break out only to return to its trading range. In only two of the last thirty cases was the S&P able to end up more than 4% when the Bearish Consensus was running at such low levels. This implies a potential area of longer-term resistance in the SPX 975-1000 area.