Sep 092010
AAII bulls: 43.9% (up from a recent trough of about 20)
AAII bears: 31.6% (down from a recent peak of about 50)
The positive improvement in AAII retail investor sentiment suggests the oversold market conditions that hit a pinnacle several days ago has now been corrected. In fact, bullishness is now the highest it has been since April 15, 2010 and bearishness is scraping the 2010 lows.
Some ‘smart money’ investors use retail sentiment as a contrarian indicator. Extreme levels of bearishness/bullishness can often indicate a short-term bottom/top in the markets.
