An ET Trader Sentiment Indicator?

Discussion in 'Feedback' started by Traden4Alpha, Dec 19, 2002.

  1. I wonder if ET (= Baron) could someday create a running indicator of trader's sentiments? I'm envisioning a running poll in which each ET member can vote each day on sentiment. The 24-hour rolling numerical average value from the poll would appear on the home page with a link to a "Details" page that shows a bar chart of frequency of responses and a line chart of the historical values.

    I see two possible alternatives for the definition of sentiment. First is an ease-of-trading or profitability indicator that runs from "extremely unprofitable" to "extremely profitable" over a -10 to 10. The second alternative is a short-term direction indicator that runs from "extremely bearish" to "extremely bullish" over a -10 to 10 scale. (It could also be a 0 to 10 scale, -5 to 5, -100 to 100, or whatever)

    Two factors made me think of this. First, it seems that trading has gotten harder of late, but this evidence is largely anecdotal. Second, AAII (American Association of Independent Investors) publishes an sentiment index that gets occasional press coverage. An ET Sentiment Index might provide additional publicity for ET and lead to greater respect and clout.

    The exact rules would need to further developed. I realize that this is a nontrivial project so it may not be feasible or worth the effort. Finally, it is a separate issue on whether the poll would be a leading indicator or contrarian indicator of future price action.

    Cheers to all,
  2. Baron

    Baron ET Founder

    Thanks for the suggestion. I think it could be done without too much trouble. I'm currently working on some of the prior suggestions that have been suggested in this feedback forum over the last few months, so as soon as I can get some of these other projects off my list, I'll start looking at this one seriously. Thanks again!
  3. yeah, ever since aphie stopped broadcasting his speculations, ET sentiment has been tough to follow...

    we need someone to fade, don't we? :D
  4. Andre


    Kind of curious about who would vote, or who people *think* should vote. I'm not sure it would be much value if every Tom, Sally or Chris voted. Nothing personal, but I shouldn't be voting, for example. It would be like if Joe Monday Morning Quarterback voted in the sportwriter's college football poll.

    However, ET has many solid professional traders. If Baron picked maybe 50 people and they agreed to vote saaay, every Sunday for the coming week's sentiment... I think ET would have a poll of real value. Plus, it might be a feather in the cap (ie: incentive) of some of these folks to vote and be listed.

    What do folks think about that?

  5. It would be interesting.
  6. Babak


    I think its a great idea!

    (believe it or not I pm'ed Baron about a very similar suggestion recently -- great minds think alike! :D)

    I would add the following:

    * a weekly not daily poll
    * only those above a certain level of membership can vote
    * only one or two questions (ease of trading/direction are good)

    Lets give it a whirl ! If it doesn't work or has problems I'm sure we can fix it on the fly. In the worst case scenario, it flops. In the best care scenario, it becomes the trading sentiment indicator quoted by the media !!
  7. Ahw Hell, it's doomed for certain then! :D
  8. The one problem I see with an indicator such as this is that one persons good trading day will be another persons bad trading day. Some days are good for trend traders, some good for range traders, some good for swing traders, some good for scalpers, etc... There have been times when I've seen members post that it was an awesome trading day and I've had my headed handed to me. There have been periods where members complain that the market can't be traded and I've done ok.
    I have a feeling that if you had this indicator that it would hover around 0 much of the time. It would be interesting to see however.
  9. with both 'andre' and 'macal'....

    becasue I'm feeling agreeable today after having a good day... Monday might be a crap trading day; thus my vote and sentiment would differ from today, and I'd be less agreeable! :D

    Another concern is multiple votes from different addresses of the same trader that could skew the polls... guess it would require the honor system. Also the question(s) would have to be well formulated to provide worhwhile guidance and indication of sentiment that is sought. More like "is the current level of NDX better suited for a long or short play" OR, "the likely support on the DOW is ____ ?" OR, " the likely support on SPX is ____ ?" OR "Signifcant support (or resistance) for the current trend/move is _____"?

    Or "the current VIX levels portends 1. more downside 2. a nearby trading bottom/reversal?" 3. no edge ?"

    ETC. ETC.

    Of course these do not necessarily shed light as a sentiment indicator for intra-day trades.