Sundial Says Extreme Options Sentiment Is Awful Omen for Stocks Joanna Ossinger, Bloomberg News (Bloomberg) -- Small options traders are bullish to a point that signals trouble for U.S. equities, according to Sundial Capital Research Inc. “Last week, the smallest of options traders, those with trades for 10 contracts or fewer at a time, opened a new record of net bullish positions,” Sundial President Jason Goepfert wrote in a note Tuesday. In comparison, very large traders, those with trades of 50 or more contracts at a time, haven’t been betting so much on a rally, he said. That has widened the spread between small- and large-trader net bullish positions to a record, with the gap jumping “like it did in 2008” in the past couple of weeks, he added. Extremes in the data have consistently led to poor market returns, Goepfert wrote. Goepfert said he tends to give options data more weight when they reach compelling extremes because they offer “a much better idea of who is doing exactly what, and with real money,” than many market data sets. “The data from last week is disturbing,” Goepfert wrote. “It clearly shows that the smallest of traders, who tend to be the most consistently ill-positioned at extremes, have gone aggressively long, in a leveraged fashion. This has a strong tendency to lead to lower prices over the short to medium term.” ©2020 Bloomberg L.P. https://www.bnnbloomberg.ca/sundial...-sentiment-is-awful-omen-for-stocks-1.1438125
Surprising! I would have thought the consensus of opinion on small traders or even the majority was a bearish outlook looking forward.
Price action rules . Right now its still bullish . I believe a day of reckoning is coming in next 3 months or so . And when it does i'll dance on the bulls grave . But till then i'll party with the bulls . The old saying " Keep your friends close(bulls) and your enemy's closer(bears)". lol
I'm not bearish atm, last week I was briefly for a couple days, but lots of bearish calls on ET for a while now. But the article above said most were bullish which goes counter to what a lot of ETers have been saying imo.
Because Traders are inherently bearish inside . The reason why is simple . They watch the massive fraud and manipulation in the mkt daily and it shapes their views and thoughts (hopefully they don't trade that way).And example yesterday. Moderna comes out with vaccine news before the open and its sky's 25%( No doubt since it's funded by the gov't for the vaccine Trump made the call to the eco to get news out). After the close bamm accouncement that their raising $1.2 billion in a stock offering . If you don't think that was planned i have beach front property in siberia to sell you.
Goepfert not calculating our "brother in arms" at RobinHood.....I think they are buying every single call option that is available under the sun..... And Warren Buffet´s strategy doesn´t work anymore... He will sit on his $120 billion in cash after the train has passed long time ago.....
Anecdotally, to me it seemed bulls have dominated retail online conversations for a few weeks now, then again I read also investment forums with long only guys. Bears (raises hand) get lured in and slaughtered every time.