Home Info-Graphs A low/complacent VIX vs very bullish investor sentiment

A low/complacent VIX vs very bullish investor sentiment

This article reviews the data from the latest weekly sentiment survey we conduct over on Twitter.  The survey measures respondents’ equity and bond positioning/view – differentiating between whether the view is bullish or bearish for technical or fundamental reasoning.  The latest results were more or less in line with that of last week’s and the main takeaway in that respect is that the signals then are if anything accentuated e.g. see the bonds vs equities sentiment chart, and the VIX vs overall net-bulls.

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Looking at fundamentals vs technicals net bullish sentiment from the equity survey, the fundamentals net-bulls held up at the highest levels since December last year, while technicals net bulls fell slightly on the week.  Basically sentiment is running at very optimistic levels on both fronts - this lines up with some of the observations in the latest S&P500 #ChartStorm --> the main theme was "greed is good".
Looking at the other two feature charts, the rolling 4-week average of net bullish sentiment for equities and bonds have traced a very interesting pattern, with bond sentiment running decisively negative in the wake of the Fed's announcement of quantitative tightening.  However, the fact that equities have been tracing a similar course suggests there may be more to it than just the Fed.  Meanwhile the last chart shows a potentially ominous combination of very bullish sentiment and a very low VIX...
Fundamental net bulls went sideways at solid levels, while technical net bulls ticked down on the week.

Bond bears are out in force, and equity bulls are starting to follow them...

A potentially ominous combination: a low/complacent VIX vs very bullish investor sentiment.

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Topdown Charts: "chart driven macro insights" Based in Queenstown, New Zealand, Topdown Charts brings you independent research and analysis on global macro themes and trends. Topdown Charts covers multiple economies, markets, and asset classes with a distinct chart-driven focus. We are not bound by technical or fundamental dogma, and instead look to leverage any relevant factor to capture the theme. As such, here you will find some posts that are purely technical strategy, some that just cover economics and data, and some posts that use multiple inputs to tell the story and identify the opportunities. Callum Thomas Head of Research Callum is the founder of Topdown Charts. He previously worked in investment strategy and asset allocation at AMP Capital in the Multi-Asset division. Callum has a passion for global macro investing and has developed strong research and analytical expertise across economies and asset classes. Callum's approach is to utilise a blend of factors to inform the macro view.

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