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Callum Thomas

Weekly equity sentiment poll (12 Sep 16)

We introduced the weekly equity sentiment poll last week (as a reminder it distinguishes between bullish and bearish on equities for fundamental vs technical rationale). Here's an update of the charts with the latest numbers. Given the market action on Friday the poll numbers take on a particular interest this week.

To start with, the above chart shows the trend for each of the 4 options in the poll (bullish or bearish and based on fundamentals vs technicals). The selloff has had a clear impact...

The result is the worst bull-bear spread since the survey began 11 weeks ago now. It's an open question as to whether it's time to be bullish on a contrarian basis, but certainly that is where I would lean towards.

Below are the 4 supplementary charts showing the bull bear spread specifically for fundamentals and technicals and also the technicals vs fundamentals spread (a gauge of whether technicals or fundamentals are driving the view), and for good measure the number of respondents.

What's notable is the downward trend in the fundamentals bulls/bears spread and the large swing down in the technicals bull bear spread. Both had been trending downward, seemingly anticipating the selloff.

Bottom line: The overall bulls-bears spread is at the lowest level since the survey began (driven by a big swing in technicals sentiment) which could be a contrarian bullish signal.

I'm also trialing a bond market version of this survey, see first results here: https://twitter.com/Callum_Thomas/status/774771450720817152

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