The most accurate measure of Stock Market Sentiment is the Daily Index Sentiment^©

Published here by the W. B. Busin Group.

April 15, 2009   2200 ET  -

When an investment becomes trade, it is the investor's intent that made it an investment and his/her stop loss that makes it a trade.

Don't be silly when it comes to being wrong. Get out and sit in cash.  That's what we have been doing for much of the past few sessions. 

This is a very tough market for daytrading consistency for either trading ETF's, stocks, options, or index futures.  It is a condition worsened by expiration week and its tricks.  Patience is the paymaster for all traders, especially new traders.

Sentiments remain in neutral and the indexes can do what they want here, just as they have been doing for several sessions.

April 14, 2009   2350 ET  -

The indexes tumbled down a couple of steps today.  But they still have the grip on the handrail of the uptrend don't they.  Until the indexes lose that grip (grip on higher highs and higher lows), the trend will remain intact.  Wednesday's action can be whatever they want, with sentiments central to the neutral zone.  That can either be a flat and lateral track, or, a more surprising reversal from lower low.  That is what we expect for tomorrow, a wee bit wild in front of expiry.

The average ETF trader is trading this move from the March lows, both against and with the trend.   Depending on the particular ETF, the overnight position is the most profitable and the most unprofitable, that is, the highest of risk.  The QQQQ is especially appealing to holding overnight, as the gaps are enticing since the intraday trading spreads tend to contract, as a high is set in.

That is a mere caution.  Let the underlying index be your guide for consistency, not the ETF. 

April 13, 2009   2200 ET  -

A morning drop shook loose the weak bulls.  We view the sentiment drop as potentially setting up a significant price move.  Our bias is still to the upward unless sentiment rises tomorrow back into the bearish zone.

April 9, 2009   2200 ET  -

As we stated earlier this week, the sentiments both rose into the Bearish or sell zone, as we expected.  Both sentiments are at/near 90 on the normalized scale.  The potential for a similar bending of the sentiments in the January 2009 (seen on the graph) is quite possible.  Consider these facts: the bullishness evident here and now, the break above and close above SPX/Dow/NYSE resistance. 

Other technicals should be used to adjust any position if Monday pushes higher in price but is not followed by a commensurate rise for sentiments.  Since that is inevitable if index prices rise on Monday, then we would look closer for opportunities for short entries next week.

We remain open to either the slog upward and bending sentiment, or to a reversal of sentiment and price beginning near Monday's opening.

April 8, 2009   2200 ET  -

As we stated yesterday, the send-off to the long Good Friday/Easter holiday weekend should be a completion of moving sentiments back above the Bearish level.  We will decide if price is going to continue higher into next week using our timing algorithms and other technicals.

Is it a sell on Thursday, or, is the rally on for more upside? 

April 7, 2009   2200 ET

Pre Easter Holiday slackening volume patterns and normal price swings can result in the counter ticks of the market sentiments, shown circled in green.  Technically, they are still in the neutral zone, and will soon begin to give another sell signal if it rises above 80.  The rising sentiments and declining price is occasionally seen in periods of rising enthusiasm for "buy the dips" mentality of traders.  I view this current divergence as a combination of both conditions.

April 6, 2009   2200 ET

Light volume, a late session rally off the lows and the re-unification of the "dipster buyers" is keeping index and futures prices at bullish levels.  Our sentiment indicators are in par, driven by trader and investor action.  The sentiments dropping back below the 80 level allows for a potential 'soft landing' of an expected chop into Wednesday's closing.

April 3, 2009

Both sentiments moved into Bearish zone.  Technicals may support a brief decline on Monday to return the sentiments back into neutral.  We also view a strong potential to perform a version of the early January pattern.  The rise into Bearish zone on a roughly flat session supports the latter if the Monday action pursues the lateral track, enticing buyers to enter for the last move up before a more significant corrective.

April 2, 2009

After 2200 ET

The late session pullback tempered the strong intraday rise of the two sentiments.  Other more sensitive short term sentiments are pointing to a potential pullback into tomorrow's closing.

Graph updated through today's closing.

1400 ET

Sentiment are projected to approach or cross the 70 level.   We expect the two sentiments below and others are signalling a set up for a short term selling opportunity, possibly early next week.

Graph update after 2200 ET

WBB Group

April 1, 2009

When the Daily Index Sentiments are in neutral, anything can happen.  The indexes can continue the previous move, continue trending, reach toward one the extremes, and a few more market tricks can be sometimes seen originating from the "neutral" zone.

W. B. Busin