Where Did All The Bears Go?
So traders everywhere are worrying that the number of bears in the recent Investors Intelligence poll is down to just 15.5%, the lowest since March ‘87.
The thinking goes if there are no bears, the market has to peak.
Not so fast, my friends (thanks Lee Corso). Looking back, March ‘87 was the kick off to a huge six month rally. Of course, it ended with the ‘87 crash, still it wasn’t this big sell signal.
Then looking at data since ‘62, we’ve seen bears consistently beneath 15% and it really didn’t seem to matter. During much of the ’60s, the bears were ‘low’, yet the DJIA continued to rally. Fun fact time, the all-time low was just 4.5% in January 1977!
I’m not saying ignore the low number of bears here, just be aware that we’ve seen this before and honestly it wasn’t that bearish.