Periodically we’re asked to review other advisory services.  This week, it’s SentimenTrader.

In trading, there are basically 3 levels of analysis – fundamental, technical, and sentiment.  Fundamental analysis looks at the internals of companies earnings.  Technical analysis looks at the price and volume action.  And sentiment looks at the emotions of traders, with a bit of latitude as respects how to measure their emotions.

 Similar to Investment Research Group, SentimenTrader is published by Sundial Capitall Research – an independent research firm dedicated to the application of mass psychology to the  financial markets.

Started by Jason Goepfert back in 2001 (we actually started our businesses and research around the same time) and covers the following indicators:

VOLATILITY MEASURES  

VIX

VIX FEAR PREMIUM*

VIX TRANSFORM (transforms VIX deviations into a statistically meaningful chart)*

VXN

VXN FEAR PREMIUM*

VOLUME DIFFERENTIAL*

NYSE VERSUS NASDAQ VOLUME

STOCK / BOND RATIO*

SMART MONEY INDEX

CREDIT DEFAULT SWAP INDEX

CSFB FEAR BAROMETER

PUT/CALL RATIOS 

R.O.B.O. PUT/CALL RATIOTM (a look at the strategies of the smallest of traders – one of the most “pure” sentiment indicators available)*

L.O.B.OL PUT/CALL RATIO*

OPTIONS SPECULATION INDEX*

TOTAL P/C RATIO (WITH MOVING AVERAGES)

EQUITY  P/C RATIO (WITH MOVING AVERAGES)

ISE SENTIMENT INDEX(TM) (WITH MOVING AVERAGES)

OEX DETERMINATION INDEX*

OEX P/C RATIO (WITH MOVING AVERAGES)

OEX P/C – EQUITY P/C SPREAD*

OPEN INTEREST RATIO

BREADTH RATIOS 

ADVANCE/DECLINE RATIO (WITH MOVING AVERAGES)

NEW HIGH / NEW LOW RATIO (WITH MOVING AVERAGES)

UP VOLUME RATIO (WITH MOVING AVERAGES)

TRIN (NYSE AND NASDAQ, WITH MOVING AVERAGES)

DAILY CUMULATIVE TICK (NYSE AND NASDAQ)*

INTRADAY CUMULATIVE TICK (NYSE AND NASDAQ)*

SPY AND QQQQ LIQUIDITY PREMIUM*

S&P AND NDX DOWN PRESSURE*

PERCENTAGE OF FIDELITY SELECT FUNDS BEATING CASH*

NOTE:  WE ALSO PRESENT SEVERAL BREADTH MEASUREMENTS FOR SPECIFIC STOCK SECTORS!  CLICK HERE FOR MORE INFO

RYDEX MUTUAL FUND ASSET FLOWS 

BULLISH FUND FLOWS*

BEARISH FUND FLOWS*

BETA CHASE INDEX*

RYDEX RATIO

ENTHUSIASM INDEX*

MONEY MARKET LEVELS*

BULL VERSUS BEAR RSI SPREAD*

TOTAL BULL & BEAR ASSETS

TOTAL LEVERAGED BULL & BEAR ASSETS

… AND ALL SECTOR FUNDS

SENTIMENT SURVEYS 

AAII BULLISH

AAII BEARISH

AAII BULL RATIO MA

AAII ASSET ALLOCATION

WALL STREET STRATEGIST ASSET ALLOCATION

NAAIM SURVEY OF ACTIVE INVESTMENT MANAGERS

UNIVERSITY OF MICHIGAN CONSUMER CONFIDENCE

CONFERENCE BOARD CONSUMER CONFIDENCE

ABC NEWS CONSUMER COMFORT INDEX

N.F.I.B. SMALL BUSINESS OPTIMISM

PROPRIETARY “PUBLIC OPINION” SCORES FOR COMMODITIES*

COMMITMENTS OF TRADERS 

ALL-INDEX, ALL-PRODUCT, DOLLAR-WEIGHTED STOCHASTIC*

COMMERCIAL TRADERS NET

SMALL SPECS NET

COMMERCIALS 1-YEAR STOCHASTIC*

SMALL SPEC 1-YEAR STOCHASTIC*

SHORT SALES ANALYSIS  

ODD LOT PURCHASE PERCENTAGE

ODD LOT SHORT SALES

NYSE MODIFIED SHORT INTEREST RATIO*

NYSE DE-TRENDED SHORT INTEREST RATIO*

NASDAQ MODIFIED SHORT INTEREST RATIO

CORPORATE INSIDERS  

INSIDER INSIGHTS BUY / SELL RATIO

INSIDERSCORE.COM TOTAL MARKET SCORE

 

CASH LEVELS  

MUTUAL FUND CASH LEVELS

MUTUAL FUND CASH PREMIUM* (Takes current level of interest rates into account)

RETAIL MONEY MARKET LEVELS

RETAIL MONEY MARKET AS A % OF MARKET CAPITALIZATION*

NYSE MARGIN

NYSE FREE CREDITS

NYSE AVAILABLE CASH*

NASDAQ MARGIN

NASDAQ FREE CREDITS

NASDAQ AVAILABLE CASH*

PENNY STOCK SPECULATIVE VOLUME

INITIAL PUBLIC OFFERINGS

SECONDARY PUBLIC OFFERINGS

AMG DATATM MUTUAL FUND FLOWS

 That’s a lot of indicators.   Actually, only 25 or so are proprietary.  Most are free data that you could obtain for yourself if you’re really interested.  Then there’s the question of correlation.  It doesn’t matter how many indicators you follow, it they’re not correlated, they’re not only useless, they’ll give you a negative bias – and give you what’s called Analysis Paralysis – which will freeze you when it’s time to make a decision.

SentimenTrader’s tag line is “Analysis Over Emotion” – be careful there, because analysis can also cause emotion.  You see, there’s a chemical in the brain (Dopamine) that makes us think we can perceive patterns in randomness.  This has been the issue for most chartists and gamblers.  For example, when you’re gambling and you win – the brain releases dopamine, which gives us this euphoric feeling and makes us think we’ve figured out the pattern, and drives us to continue.  Eventually losing everything – unless we have rules that over ride our brains influence.  Most people do, however those supplementing with Dopamine may be more susceptible to this.

Excuse me for diverging from the topic.  The point being – sure – anyone can look back at a chart and say they would have bought here or sold there, even when you’re looking at a sentiment chart – it’s the same thing!  There’s no golden ticket – a chart is a chart and most sentiment charts will follow the market – if they’re correlated.  They’ll work sometimes, but not all the time…

SentimenTrader costs $25/month, $70 per Quarter or $250/year.

Investment Research Group provides all it’s sentiment charts – and models for $9.95 a month – and we give it to you free if you sign up for one of our newsletters.  Click here to sign up today.  www.stockbarometer.com