Now Reading
Quick & Dirty Sentiment Update
38

Quick & Dirty Sentiment Update

by MoleJuly 10, 2011

Well I (volar) did not do a post last week, bc not much has changed. That being said, I have some charts for kicks and giggles.

Overall, my indicators still say there is room to run (especially breadth and sentiment). This bull market has been acting like a bull market. All that being said, I have a list of a few caveats worth mentioning.

First, RYDEX Levered Bull ETF assets/ Levered Bear ETF assets.

I admit this data is “new,” but either way the ratio of bull to bear assets is approaching a level in which the market did find “tipsy” in the past. Consider that after the flash crash about 50% of the levered Rydex funds were in Bull assets, now we are at 2x or 200%. Also, unless this ratio embeds, the move outside the bollinger band has also warranted caution.

Now here is the money flow into small cap growth ETFs:
[amprotect=nonmember]
More of Volar’s charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
[/amprotect]
[amprotect=1,13,9,12,5]

Clearly, that should warrant some caution. That was a big jump. Over time money is moving from MFs to ETFs, and that makes this hard to measure changes in sentiment. That being said, there was under $1 billion in growth and small cap funds before the Japan ordeal; there is $1.4 billion as of Friday. So money is flying here… we will find out what the COT and short interest is shortly.

Now a quick point or two on seasonality.

The holiday is generally good, but the 3rd week of July can be quite ugly- or at least the bullish seasonal support is not evident. The 2nd/3rd weeks of July/ week 29/30 are about 40% positive.

Also notice how the VIX tends to go higher from here.

Clearly the short Vega into the 4th worked well, but notice how the RED area for the 3rd week of July and the first few weeks of August is roughly > 20. That simply means that there is a relatively high probability the VIX is north of 20.

Bottom Line: still in a bull market, but there are some potential caveats. I will have some new stuff and some updates this week ranging from IWM & Russel Futures put call ratios to updated short interest data.

Best of luck trading,

-Volar

[/amprotect]


About The Author
Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Anonymous

    Volar:  L-O-V-E your stuff.  I’m not aware of anywhere else you can get this type of data with unbiased analysis.  The unholy alliance (in the best way!) of Mole, Scott and yourself has really helped me become a better trader.  I struggled last year but am banking coin consistently this year regardless of prevailing market trend.  I think without you guys illuminating the darker corners of the market, I would have just given up.  My account is finally getting to the point where subscribing to one of Mole’s trading systems would be worth it. 

  • http://practicalt.blogspot.com/ Gold_Gerb
  • Anonymous

    Closing my EURUSD short at 1.4192. Going on vacation tomorrow, so found it safe to close now, before those London traders (or the idiots at ECB) do something crazy tomorrow morning.

    Have a nice summer, guys.

  • Schwerepunkt

    GG that is a seriously effed-up evil image. Gave me the heebie-jeebies. 

  • Anonymous

    GAAAHHH.  Understood.  No more unholy alliances!

  • Anonymous
  • http://evilspeculator.com molecool

    How did he get his hands on a picture of grandpa?

  • Anonymous

    EURUSD on the move

    1.415 should provide support

  • Anonymous

    Great post as usual mate :-) It seems just like sentiment got bearish too quickly, we may be getting bullish a little too quickly now.

    I have no confidence in it, but the potential for a massive bull trap exists. 

    Sorry I havent posted much lately, since the buy signal at the lows, I just dont have anything to add

  • Anonymous

    Looks like we might hit or come close to Mole’s SPX sell line of July 7.  Is that sell line number a close, or intraday?

    AND, we have a 5 day H&S going on…

  • Anonymous

    Mole
    Been watching the /DX past week, 2 higher lows off the early May low but no higher highs, 
    now its again approaching one of my key (closing) resistances around 76.5 Do you have a NLBL for it ?

  • http://practicalt.blogspot.com/ Gold_Gerb

    SPX 1324 – not what I expected so early!

    that’s the Market.
    http://practicalt.blogspot.com/2011/07/t-speculation.html

  • Anonymous

    I think they are always set for a close price.  Right Mole?

  • Anonymous

    Hey Mole! Is Helter Skelter ™ sending out signals today ?

    Ta Much

  • http://evilspeculator.com molecool

    We need to close below the current NLSL but I only use wicks for calculating the net-lines.

  • http://evilspeculator.com molecool

    It should but apparently there is no entry it likes yet.

  • Anonymous

    what’s with zeroFX, i don’t see any charts?

  • http://thebhbgroup.com TheBHBgroup

    just got a signal…system is working so far.

  • Anonymous

    Thanks – Got it..

  • Anonymous

    Mornin Folks,

    I just got back from Jury Duty which I have all week.    :(

    Needless to say, this could be a pretty exciting week with all the drama going on in the background as well as it being Op Ex.   

    When I got back, it was nice to see playing both sides of the fence worked out pretty good for me this morning as my Gamma has driven up my Negative Delta pretty nicely.

    The question is whether or not Benny’s Cavalry comes back into play today?  Perhaps his soldiers party’d too hard this weekend and are all hungover.  But I certainly wont take that for granted. Not yet anyway.   :)

  • http://practicalt.blogspot.com/ Gold_Gerb

    as they would say over in ZH..

    SPX
    http://tinypic.com/r/5my8h1/7

  • http://practicalt.blogspot.com/ Gold_Gerb

    Oh, recommend an Opt In test message first of day.
    some would love it, some would hate it.

  • Anonymous

    $ – Demo

  • Anonymous

    $ – Demo

  • Anonymous

    Come on folks.  It’s way too quiet in here today.  

    I know we shouldn’t be Perma bears or Perma bulls anymore.   

    But for those of us that are Recovering Bears, I’ll say that it’s Fucking Beautiful to see this Bullshit Market get a dose of reality even if it’s only for a few hours.  

  • Anonymous

    Come on folks.  It’s way too quiet in here today.  

    I know we shouldn’t be Perma bears or Perma bulls anymore.   

    But for those of us that are Recovering Bears, I’ll say that it’s Fucking Beautiful to see this Bullshit Market get a dose of reality even if it’s only for a few hours.  

  • http://practicalt.blogspot.com/ Gold_Gerb

    too quiet?
    ok, i’ll pimp my blog.
    http://practicalt.blogspot.com/2011/07/deadly-arc.html

    it’s free!

    (GG ducks)

  • http://thebhbgroup.com TheBHBgroup

    careful on the short side now…pretty big move here…I am taking my options off and waiting as we approach the 1313 pivot on spx.

  • Anonymous

    hi.

    you’re a pro – can you tell us how you see this market. as bullish or uncertain with lots of volatility ahead. or just playing along as price action and other stuff dictates?

  • Anonymous

    Ohhhh yeah, I’ve learned the hard way to treat this market like a minefield.  :) 

    My July SPY Puts have a decent profit built up and they will come off the table today regardless of where and how we close.  They expire this week and “a bird in the hand”. . .

    I also have a small position in SDS Stock along with some OTM SPY Calls that I’ll hold onto for now.  

    The move today could be the start of something new or just another one day wonder.  It’s going to be interesting to see how this one plays out.  

  • Anonymous

    Anybody paper trading Helter Skalper? I had success earlier today. With this latest alert, I got a better entry at 1316.75, and put my stop at 1317.75, .25 higher than the recommended alert stop. So far so good, but it seems to conflict with the Zero. Not sure how to read this yet, or if I shouldn’t look at the Zero when I’m Skalping.

  • Anonymous

    As of 2:17 PM,  Down Volume over Up Volume at -4.12 at HOD.  

  • http://thebhbgroup.com TheBHBgroup

    Your question is too open for me.  Company wise I see good earnings coming from certain sectors.  Outsides look horrible but that doesn’t matter to me.  If you are trading then it’s a dream mkt for you.

  • http://evilspeculator.com molecool

    ¤ø„¸¸„ø¤º°¨¤ø„¸¸„ø¤º°¨
    ¨°º¤ø„¸  N E W  „ø¤º°¨
    ¸„ø¤º°¨ P O S T “°º¤ø„¸
    ¸„ø¤º°¨¤ø„¸¸„ø¤º°º¤ø„¸

  • http://evilspeculator.com molecool

    I took it down – nobody was interested (to pay for it).

  • http://evilspeculator.com molecool

    No.

  • Anonymous

    thanks; “If you are trading then it’s a dream mkt for you.” yep, agree.

  • Anonymous

    “slight” divergence on the ES-zero on the last 3 or 4 bottoms today?  anyone concur?