Bearish Bloggers Keep Fighting the Tape
Looking for a sure thing?
One blogger might have found the best contrary indicator on the Street. But it might hit a little too close to home for some.
The blog Ticker Sense conducts a weekly Blogger Sentiment Poll.
The Ticker Sense Blogger Sentiment Poll is a survey of the web's most prominent investment bloggers, asking "What is your outlook on the S&P 500 for the next 30 days?" Conducted on a weekly basis, the poll is sent to participants each Thursday, and the results are released on Ticker Sense each Monday. The goal of this poll is to gain a consensus view on the market from the top investment bloggers -- a community that continues to grow as a valued source of investment insight. Ticker Sense
Some of the most prominent financial bloggers participate in the exercise. There is just one problem.
Perma-bears dominate the poll and have been fighting the tape since the poll started.
At least according to Stockbee:
No matter the market direction, one thing is constant The Ticker Sense Blogger Sentiment Poll, a survey of the web’s most prominent investment bloggers is always bearish.Nothing can make these so called “prominent investment bloggers” bullish. In the meanwhile markets have gone up since the poll started.
Now some of these are very short term day traders and one can discount their opinion, but many others claim to be long term traders or macro traders. As a group they have been bearish since the first poll started with just 2-3 positive readings.
Now the participants of this poll are very touchy when their bearishness is questioned. They offer all kinds of excuses. Most common being that they are bearish on market but actually bullish in their personal trading, or if you see my paid newsletter it is bullish and other more creative explanation.
People trade what they believe. If your belief are perma bearish, it is extremely difficult to trade opposite of that because there is lack on conviction. So if these bloggers actually trade what they believe, they should be losing money or underperforming the market substantially.
The second problem is even bigger, if , as some of them claim, that in reality they are bullish in their actual newsletter or trading then they are just misleading readers with these bearish views or lying. So they are just closeted bulls. They are better than James McGreevey in hiding that fact.
The third mystery is 99% of these prominent bloggers are practitioners of technical analysis, use trend lines, or use moving averages or other esoteric indicators. No matter which indicator you are using or the brand of technical analysis you were using , it was bullish during the time frame. So may be these bloggers don’t know how to use the tools they use.
Stockbee caused a dustup last November when he suggested that the most “popular” bloggers were no more than a cabal of lousy market timers. The evidence since then might support that view-a glance at the chart above would suggest that the bloggers turned bearish at the March lows and have never fully embraced this equity rally.
On Wall Street bearish pundits often garner respect because unpopular, contrarian views supposedly require more intellectual rigor. And most hedge fund managers seem to savor each dollar they make on the short side twice as much as every dollar made long.
Financial bloggers are probably no better or worse at prognosticating than the average Wall Street strategist. But the blogger sentiment poll might be one of the best contrarian indicators around.
Which, of course, makes bloggers worthwhile.
Whew!
How accurate are bloggers?
Fallond Stock Picks Inc
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The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No position in securities mentioned
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