Anxiety Index Does Not Support Stock Market Crash

Anxiety Index

Anxiety levels are too high so  Stock Market Crash Unlikely

This week’s sentiment data reveals that the majority of investors are in the neutral camp and until the number of individuals in the bullish camp surges past the 65% for weeks on end, the idea of a crash is just a myth.

This market falls into the insane category as well, and that is why we have been focusing so strongly on the trend indicator and market sentiment. And technical analysis comes in at distant a third.  Insane individuals have been known to do the unpredictable, and this applies to this market. It has defied all expectations. As a further precaution when our key Technical Indicators on the monthly charts of the DOW, SPX and Nasdaq experience bearish crossovers we will take a more defensive posture.

Market Sentiment

Anxiety levels, in general, are too high and as a result, a stock market crash is unlikely at least for now.

 

Market Sentiment is not Negative so Don't expect a stock market Crash

Anxiety Index readings are not supportive of a stock market crash

Anxiety Index not supportive of a stock market crash

The crowd is still too anxious to support a stock market crash scenario; a stock market correction is possible but a crash is out of the question.  Markets climb a wall of worry and fall down a cliff of joy, the wall of worry continues to grow so the markets are more likely to trend higher before pulling back.  Astute investors should consider using strong pullbacks to open new positions in strong stocks.

 Strong Corrections and Crashes are triggered by Bullish Readings

The masses for whatever reason have refused to embrace this market and until they do (something we have been saying for years on end) the markets are destined to trend higher.  All strong pullbacks should be viewed through a bullish prism.

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