The Master Sentiment Index (MSI) Signals The End Of The Bear Market

Jul. 28, 2022 6:38 AM ETSH20 Comments
Michael James McDonald profile picture
Michael James McDonald


  • The Master Sentiment Index (MSI) is signaling the end of this bear market.
  • Extreme bearish sentiment is better than any other technical or economic statistic at signaling endings of bear markets.
  • The MSI is a composite indicator made from the puts to calls ratio, COT data, dollar purchases of bearish ETFs and four other classic sentiment indicators.
  • The current MSI number is at the same level it was at during the previous eight bear market lows.
  • Famous old quote: "Market turns are as obscure while they’re occurring as they are obvious after they’ve occurred."

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MSI versus SPY

The Master Sentiment Index [MSI] vs SPY (Michael McDonald)

Master Sentiment Index Indicates the End of the Bear Market

This 16-year chart plots the Master Sentiment Index, which is a composite index made from seven historical

This article was written by

Michael James McDonald profile picture
Michael James McDonald is a stock market forecaster, author and former Senior Vice President of Investments at what is now Morgan Stanley. He is a long-term advocate of the theory of contrary opinion and the measurement of investor sentiment when forecasting price direction.His first book, " A Strategic Guide to the Coming Roller Coaster Market" was published in June of 2000, three months before the top of the dot comm market. On its cover was written, "How a new model of the stock market predicts the end of the 18-year bull market (1982-2000) and the beginning of a new era." The "new era" was to be a long-term (roller coaster) trading range market, which did materialize between 2000 and 2009.Then, on August 31st, 2010, in a SA article titled: "The 10 Year Trading Range Is Over - The 'Final Stampede' Has Begun", he called an end to this trading range market and the beginning of another long-term bull market, which also came about. Through his company the Sentiment King, he continues to study and do what he loves - research and attempt to successfully forecast major stock trends - and help others see them too.

Disclosure: I/we have a beneficial long position in the shares of SSO either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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