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Strategies & Market Trends : Investor sentiment surveys - a technical indicator

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To: Mat Miller who wrote (66)6/20/1997 2:01:00 PM
From: Q.   of 167
 
AAII bullish sentiment today hit 59%, up from 49% a week ago, making the two-week average 54%. This is just below the level of 55% at which one would have always done well getting out of the market, since 1987.

There has been one occasion when the two-week average was 54% and there was no subsequent correction. But 55% has been exceeded only 3 times, and one would have done quite well getting out all three times:

8/21/87, pretty much at the top of the peak and a couple of months before the big crash

12/24/92, the stock market actually went up 2% over the next 12 weeks, so this was a false incdication of a correction.

5/31/96, near the peak before the correction last summer.

In the following post, I paste the AAII database in text format.
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