Taking Stock of Technicals and Sentiment

We take a closer look at market technicals and sentiment this week with the historically volatile second half of October upon us. Although there has been some near-term volatility and equity weakness, the longer-term technical on equities continue to look very strong. We will show this by examining three different technical indicators that, combined, show the potential for positive longerterm signals for equities. Turning to overall market sentiment, the overwhelming evidence suggests there is still a significant amount of worry about future price returns. From money leaving equity funds, to market sentiment polls showing an unusually high level of worry this close to all-time highs, sentiment could potentially be a nice contrarian reason to remain bullish.