Tuesday, March 09, 2010

Sentiment Turning Bullish

The CBOE equity put/call ratio has been a pretty good contrary indicator of late. We saw elevated bearishness when the market bottomed early in February, and then we saw elevated bearishness before this most recent market thrust upward.

Now, however, we're seeing levels of bullish sentiment that are at multi-month extremes. If the indicator continues its track record, we should see limited upside from here.