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RE: Sentiment - 50%?



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In response to your question about 50% sentiment...and "how can be anything
but 50%???"

Sentiment has to do with number of "advisors" that are bullish. If:
* all market participants were captured,
* people actually traded their belief, and
* everyone traded with the same amount of cash.

...then the bullish consensus (BC) numbers would be 50%.

The fact that BC isn't 50% shows that there is a bias in the information.
Even though all of the details of the information bias are not known, often
times there is a correlation with market behavior. The people that aren't
measured are oftentimes correct.

Look for excesses at each end of the range.

-----Original Message-----
From:	angus@xxxxxxxxxxxx [mailto:angus@xxxxxxxxxxxx]
Sent:	Sunday, April 19, 1998 10:32 AM
To:	omega-list@xxxxxxxxxx
Subject:	Market Systems

In a message dated 98-04-18 15:51:04 EDT, you write:


How do you enter and backtest fed policy and sentiment into an automated
trading system? Also, seeing how there are always the EXACT number of longs
and shorts in the S&P, how on earth can sentiment be anything but 50%?

Andy Abraham cta
Angus Jackson
www.angusjackson.com