I must admit that the structure of broad sentiment messed with me leading in to the current err, issue. Sentiment and the structure of T bonds (more on this in NFTRH154) kept me from being whole hog bearish on the short term (as opposed to simply hedged), and there is something to learn here. Like some of the worst market declines can happen within a backdrop of theoretically bullish contrarian sentiment. When things go asymmetrical, some tools will go dormant pending a return of symmetry - or something like that.
One tool is still on the job however, and it is the gold-silver ratio. It is only just getting started to the upside and argues that things may continue to be very unruly and broad sentiment will get worse before it gets better.
|Smart/Dumb Confidence compliments of Sentimentrader.com|