I have recently been complaining about the excessive bearish sentiment.
Whether it was Tony Robbin’s economic warnings, the excessive bearishness of Wall Street Analysts, or the the recession porn of the Hindenberg Omen, there has simply been too much negativity. Even the pushback on Leveraged Inverse ETFs had an air of excess and arrogance, that often precedes a reversal.
We are seeing that reversal today. The 250 point pop in the Dow is in large part due to the aforementioned sentiment excesses.
That’s the good news. The bad news is this move only puts us back into the prior trading range of 1040-1115 on the S&P.
And, it makes that 1040 level even more important. (Woe to the SPX if and 1040 breaks).