Find new investment opportunities based on Market Sentiment Indicator. Manage watchlist risk with leading indicator of volatility See what influential analysts and investors are saying about stocks in your watchlist
Most Trending
+16.90%
+10.21%
+15.22%
+11.82%
+24.80%
Most Trending
+16.90%
+10.21%
+15.22%
+11.82%
+24.80%
TrendspotteamFinding new investment opportunities based on Market Sentiment and Indicators. Manage portfolio risk with leading indicator of volatility See what influential analysts and investors are saying about stocks in your watchlist
In recent weeks, Wall Street has witnessed a surge of optimism as key indicators and investor sentiment point towards a sustained market rally. The fear index, a reliable measure of market anxiety, has been on a downward trajectory, while leading stock indices have reached new highs. Private investors are increasingly optimistic, with many believing that the current rally is just the beginning of a period of sustained growth. In this article, we'll delve into the factors driving this optimism and explore why investors are confident that the good times on Wall Street are far from over.
The Fear of Missing Out (FOMO) is back in the stock market, with the S&P 500 experiencing a robust recovery. The index has recorded gains in nine out of the last ten trading days, surging by 7.2% in just two weeks – the strongest sequence of increases this year. Investors are now betting that this momentum has a solid foundation, prompting a shift away from defensive trading strategies.
Cboe's volatility index, known as the "fear index," has been steadily declining for eight consecutive trading days. This indicates a trend where traders are abandoning protective contracts, signaling confidence that the market will remain stable in the coming weeks.
Private investors are adjusting their portfolios in response to the optimistic market conditions. Many are moving into funds that track U.S. stocks, while simultaneously reducing bearish bets on the S&P 500 and the tech-heavy Nasdaq 100. The activity in bullish options on the S&P 500 has reached historic levels, reflecting a growing appetite for potential gains by the end of the year.
A significant factor behind the market's U-turn has been a dual boost from Washington. The Treasury's increase in long-term debt sales at a lower-than-expected rate, coupled with the Federal Reserve's indication of no further interest rate hikes this year, has bolstered both stock and bond markets. Falling yields in the government bond market, which contributed to recent market volatility, have further fueled bullish sentiment.
Economists and analysts are revising their outlooks in response to positive economic indicators. Jan Hatsius of Goldman Sachs, a historically optimistic economist, acknowledges that the economy has outperformed expectations. Predictions of continued economic growth and declining inflation have contributed to a positive market outlook.
A survey conducted by the Association of Private Investors reveals a significant shift in sentiment among respondents. A growing 43% believe that share prices will rise in the next six months, compared to 24% just a week earlier. Conversely, bearish sentiment has dropped by almost half to 27%, indicating a widespread shift towards optimism.
Hedge funds and money managers are reducing their bearish bets against the S&P 500 and the Nasdaq, with levels reaching lows not seen since 2022. Additionally, investors are abandoning avenues that bet against major tech stocks, including Apple, Microsoft, Alphabet, Amazon, Nvidia, Tesla, and Meta, reaching all-time lows.
As 2023 approaches its end, Wall Street appears to be defying earlier predictions of losses. Investors are increasingly confident in the market's upward trajectory, with bearish bets at their lowest levels in months. The overwhelmingly positive sentiment, coupled with strategic shifts and economic indicators, suggests that the current rally has solid foundations, paving the way for further gains in the coming months.
Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.
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Disclaimer:
The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained.
The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.
Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").
This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.
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Disclaimer:
The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained.
The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.
Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").
This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.
