Measuring the market's Bullish or Bearish sentiment is important when attempting to determine the market's future
direction. Market Edge tracks nine technical indicators that measure excessive speculative or sentiment conditions
prevalent in the market.
| SENTIMENT INDEX: | +3 |
| INDICATORS | READING | CONNOTATION |
| 1) Odd Lot Short Ratio-10 Day Ave | .04 | Bearish |
| 2) NYSE Short Interest Ratio | 4.21 | Bullish |
| 3) Public-Specialists Short Ratio | 0.58 | Bearish |
| 4) Put-Call Option Ratio | 77 | Bullish |
| 5) Dividend-Yield Spread | 5.22 | Bullish |
| 6) Mutual Fund Cash | 6.70% | Bearish |
| 7) Bullish Investment Advisors | 36.90% | Bullish |
| 8) Bearish Investment Advisors | 39.70% | Neutral |
| 9) Bearish + Corrections Total | 23.40% | Neutral |
Sentiment based technical indicators are:
| INDICATORS | READINGS | CONNOTATION |
| 1) |
Odd Lot Short Ratio: The number of Odd
Lot shares sold short divided by the total number of Odd Lot
sales. |
>= 10
5 - 10
0 - 5 |
Bullish
Neutral
Bearish |
| 2) |
NYSE Short Interest Ratio: The number of shares sold short on the NYSE divided by the average monthly trading volume. |
3.5 - 9.0
3.0 - 3.5
0.0 - 3.0 |
Bullish
Neutral
Bearish |
| 3) |
Public-Specialists Short Ratio: The number of NYSE shares sold short by the public divided by the # of shares sold short by the specialist. |
>= 1.50
0.68 - 1.49
<= 0.67 |
Bullish
Neutral
Bearish |
| 4) |
Put-Call Option Ratio: A ten day moving average of the number of Index Put options purchase divided by the number of Index Call options purchased. |
>= 1.7
1.0 - 1.7
0.0 - 0.99 |
Bullish
Neutral
Bearish |
| 5) |
Dividend Yield Spread: The relationship between the average NYSE dividend rate andthe yield on thirty year Treasury bonds. |
0.0 - 5.0
5.1 - 6.0
>= 6.0 |
Bullish
Neutral
Bearish |
| 6) |
Mutual Fund Liquid Asset Ratio: The ratio of mutual fund cash to total assets. |
>= 10.0
6.0 - 9.0
0.0 - 5.0 |
Bullish
Neutral
Bearish |
| 7) |
Bullish Investment Advisors: The percentage of newsletter writers who are Bullish on the market as measured by Investors Intelligence. |
+00% - +35%
+36% - +54%
+55% - +99% |
Bullish
Neutral
Bearish |
| 8) |
Bearish Investment Advisors: The percentage of newsletter writers who are Bearish on the market as measured by Investors Intelligence. |
+50% - +99%
+21% - +49%
+00% - +20% |
Bullish
Neutral
Bearish |
| 9) |
Bearish + Corrections Total: The total percentage of newsletter writers who are either Bearish or forecasting a correction for the market as measured by Investors Intelligence. |
+00% - +29%
+30% - +69%
+70% - +99% |
Bearish
Neutral
Bullish |
Each indicator is assigned a positive, negative or zero value depending on whether its reading is deemed to be Bullish, Bearish or Neutral . The sum of these values is referred to as the Sentiment Index. Plus 3 to plus 11 readings are Bullish, while minus 1 to minus 11 readings are Bearish.
