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Bull
/ Bear Readings
Brian
Trumbore
President/Editor, StocksandNews.com
It's been over a year since I wrote
anything about the "Investors Intelligence" survey
of over 100 financial newsletter writers that is released
weekly by what is now called Chartcraft. Historically,
it has been one of the many devices that strategists
use to gauge market sentiment and is typically viewed
as a contrarian indicator, i.e., a high bullish reading
may mean rough sledding ahead (an excess of optimism),
while a high number of bears may signal that we are
near a market bottom (too much pessimism?everyone
who wanted to sell already has).
The
survey is released on Wednesday and represents the
accumulation of data from the prior 7-day period,
so there is a lag time involved, especially in the
days when it was published in Barron's. Alas, the
holders of the data wised up and began charging for
it, so your dear editor coughed up $295 to help keep
you informed. [I list the bull / bear readings in
my "Week in Review" column.]
Of
course a big reason why I have written little of the
survey over the past year is it's been largely meaningless,
with little variation week to week, save for the market
slide last October, which proved to be a good short-term
buying point.
But
recently the figures have begun to move a bit and
next week we'll explore the trends of the past few
years. For today, though, I thought we'd go back to
the period prior to, and after, the first Gulf War,
with some selected dates as our guideposts.
[In
order to avoid browser issues the format may appear
a little different, but that makes it easier on all.]
Date??.Bulls?.Bears?.Dow
Jones
5/4/90??33.3?.49.6??..2710
6/8/90??47.8?.35.4??..2862
7/27/90?..49.6?.34.1??..2898?week before, Dow hit
2999
8/10/90?..37.6?.45.6??..2716?invasion of Kuwait, 8/2
9/21/90?..27.9?.55.7??..2512
10/12/90?32.2?.53.7??..2398?market bottom for cycle
12/7/90?..41.4?.50.0??..2590
1/11/91?..39.8?.46.6??..2501?uncertainty
1/18/91?..34.5?.52.1??..2646?bombing starts 1/17
2/15/91?..51.3?.36.1??..2934?ground war begins 2/24
3/1/91??58.6?.29.3??..2909?euphoria, Bush at 90%
6/14/91?..38.8?.28.4??..3000?reality setting in
12/6/91?..36.9?.39.7??..2886
1/24/92?..60.0?.19.1??..3232?pickup in bulls on rally
7/3/92??35.3?.31.9??..3330?economic concerns
11/6/92?..45.1?.31.0??..3240?election week
6/10/94?..25.2?.51.3??..3773?just jumping ahead
12/9/94?..33.1?.59.1??..3691?good 'buy' point
2/9/96??53.8?.29.4??..5541
The
people who do the Investors Intelligence survey say
that a normal bull / bear ratio is 45/35. You really
need numbers significantly in excess of 50 or below
30 before most of us take notice.
Of
course with the pending action in Iraq, part II, perhaps
history can be our guide, though admittedly there
are far more ancillary issues, like a huge U.S. presence
remaining in the country post- Saddam, than there
were back in 1990-91.
---
Next
week?1996 to the present.
Brian
Trumbore
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