There is reason to be concerned even with global stock markets on a tear recently. There is a shocking chart featured below which all KWN readers around the world need to see.
If you look at the chart below it reveals there are some serious warning signals even as many major indexes have been hitting new highs.
Here is the latest Investors Intelligence report along with the all-important sentiment chart: “With no sign of an end to Fed stimulus equities seemingly remain the only game in town for capital appreciation. Q3 earnings continue slightly above forecasts. Technical indicators have started negative divergences with retreats from prior highs though, and last week ended with a second straight reading above 380 buying climaxes. The newsletter editors were even more bullish and other Sentiment measures have also achieved very worrisome levels. Conditions are building for some corrective relief.
The bulls reached 55.2%, up from 52.6% a week ago and now in danger territory. After a 12.9% surge in three weeks their number is now just equal to their May 2013 peak. Stocks retreated from there through June. The last higher number of bulls was 57.3% in April 2011. The SPX was down 18% late that summer. The high reading suggests portfolios are near fully invested and points to increased risk. The last time the bulls exceeded 60% was late October 2007. ...