January February: Investor Sentiment

january february: Will the gains be followed by pain The chart below plots the S&P 500 against six different sentiment gauges, according to Market Watch. The dashed green line highlights how bearish investors were in January/February when the Profit Radar Report issued a buy signal at S&P 1,828 . Caption outside of wrapper for normal article images The arrows show how much more bullish investors are now compared to January red arrows indicate VIX and put/call ratio declines, a reflection of bullish sentiment . Based on investor sentiment, there's significant down side risk. Investor sentiment has gone from extremely bearish to extremely bullish. Do other indicators agree Liquidity There is a lot of money flowing into the stock market, which is a positive. Technicals Back in August, technical analysis strongly suggested a stock-market rally even more powerful than expected at the beginning of the year more detail available here . On Jan. 31, the Profit Radar Report published the 2016 S&P 500 Forecast with the below projection the projection is based on four key indicators liquidity, technical analysis, sentiment and seasonality . Caption outside of wrapper for normal article images As per the yellow projection, the year-end target was at 2,220, with resistance Fibonacci, trend line, trend channel at 2,250-2,290. In fact, on Sept. 25, the Profit Radar Report pointed out that our liquidity indicator already climbed to new all-time highs, even though the S&P 500 SPX, 0.13% did not detailed liquidity analysis available here . The stock market usually follows the money, and when money liquidity flows into stocks, stock prices will follow, which is what we've seen the last six weeks. (news.financializer.com). As reported in the news.