Investor sentiment toward U.S. stocks is poised to change for the better and contribute to a multiyear advance, according to Ralph Acampora, a partner and head of market research at Altaira Wealth Management LLC.
“I have never seen so many people so negative on the stock market for so long,” Acampora wrote yesterday in a posting on Twitter. The Minneapolis-based analyst has been a technical analyst, focusing on price charts, since 1966.
The CHART OF THE DAY highlights a contrast between the Standard & Poor’s 500 Index performance and the outlook for share prices, based on weekly survey data from the American Association of Individual Investors, since the current bull market started in March 2009.
Optimism peaked in September 2011, judging by the average gap between the percentage of bulls and bears in the prior 52 weeks of AAII surveys. The latest average was 2.6 percentage points, close to last year’s low of 2.02 points in July.
The potential for a sentiment shift was among 11 reasons that Acampora provided for being a “secular bull” in postings on Twitter, where he had about 3,750 followers as of yesterday. Gains in overseas stock markets and the 10-year Treasury note yield’s rise above 1.9 percent this month were among others.
“The March 2009 low was and is a generational low,” he wrote. “We will work our way irregularly higher.” The S&P 500 has more than doubled since dropping to a 12-year low of 676.53 on March 9, 2009.