Bears Knocked Out: Market Sentiment Shifts as Bulls Cut ProfitGuys, don't get me wrong, but it's like they knock out the bears before going down. The sentiment indicators we're looking at agree with that.
In particular, yesterday, with the rise in quotes, some participants are actively draining call options in-the-money with about 15 trading days ahead. In other words, they just cut the profits and didn't wait.
Take a look at this chart
It shows the balance of bullish and bearish open positions among retail traders, and how it change over time. Two things are clear: 1) there's a correlation between how prices move and the number of traders who are long vs. short, and 2) there are certain levels where the balance tips and the trend reverses (basically, it's like a oscillator indicator).
The red line shows your current position. You'll have to make your own decisions and observations.
Use retail sentiment in your trades - it's a great tool that can help strengthen your strategy and make your trading more efficient.
