2019-04-22 11am EDT | #stocks #sentiment
In all my time studying markets, I can’t recall a single instance when the split between “pros” and “retail” has ever been higher.
What do I mean by that?
Well, amongst the professionals who manage money for a living, there seems to be a universal bearishness regarding the outlook for the stock market in the coming months. But wait! I can hear the push-back already - there are plenty of bulls out there spouting their optimistic forecasts all over the financial news networks. And yes, that is correct. However, these are almost all perma-bulls. When Reformed Broker Josh Brown whispers sweet-nothings about stocks it means squat as he is always bullish. On the other side of the coin, when Peter Schiff howls about the coming equity market collapse, it’s simply another day of the week that ends in the letter Y. To get a sense of the true sentiment amongst professionals, you need to ignore the perma-bulls and bears - instead focus on the group who actually change their opinion based on circumstances.
There is little doubt that amongst these professionals almost everyone is bearish. They might not be forecasting another 1987 market crash, but there are precious few who believe this rise is justified by fundamentals and due to continue. The pain from last year’s December swoon is too fresh in their minds.
Whether it is CNBC-regular Dennis Gartman worrying about the prevalence of money-losing IPOs;
Or this quite-funny tweet about the possibility of a “melt up”;
There are practically zero professionals who believe this rally has legs and will continue to blast through to new highs.
Want some actual data...