{"id":20286,"date":"2012-08-20T13:11:21","date_gmt":"2012-08-20T17:11:21","guid":{"rendered":"http:\/\/www.thedisciplinedinvestor.com\/blog\/?p=20286"},"modified":"2016-09-20T12:30:36","modified_gmt":"2016-09-20T16:30:36","slug":"what-are-the-contra-indicators-saying","status":"publish","type":"post","link":"https:\/\/thedisciplinedinvestor.com\/blog\/2012\/08\/20\/what-are-the-contra-indicators-saying\/","title":{"rendered":"What Are The Contra Indicators Saying?"},"content":{"rendered":"<p>Let&#8217;s take a quick look at some of the indicators that help investors gauge if a market is oversold or overbought. Generally, these are not conditions that we look at for individual stocks, but can be helpful when looking at the complexion for a broad based index.<\/p>\n<p>Often times, markets will overshoot one way or <!--more-->the other. The exact level of the overshoot can be revealed by looking at the put\/call ratio, McClellan Oscillator and the AAII sentiment readings.None of these are absolute, just one more piece of the puzzle.<\/p>\n<p>As Tom McClellan told us in the <a title=\"TDI Podcast: Presidential Cycles, Sector Rotation and The VIX  (#276)\" href=\"http:\/\/www.thedisciplinedinvestor.com\/blog\/2012\/08\/19\/tdi-podcast-presidential-cycles-sector-rotation-and-the-vix-276\/\"><strong>latest TDI Podcast<\/strong><\/a>, the simple structure above the zero line is not convincing him that the bulls are entirely in charge at this point.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/mccl-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-20301 aligncenter\" title=\"mccl\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/mccl-1.jpg\" alt=\"\" width=\"500\" height=\"309\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Investor sentiment is gaining, although not high enough to for a warnings at this point. It is now matching the levels last seen in late April, just before the markets corrected.<\/p>\n<p><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/aaii-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-20299 aligncenter\" title=\"aaii\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/aaii-1.jpg\" alt=\"\" width=\"482\" height=\"326\" \/><\/a><\/p>\n<p>The Put\/Call ratio is very low and that is usually indicative of overconfidence.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/putcall-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-20300 aligncenter\" title=\"putcall\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/08\/putcall-1.jpg\" alt=\"\" width=\"510\" height=\"332\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Let&#8217;s take a quick look at some of the indicators that help investors gauge if a market is oversold or overbought. Generally, these are not conditions that we look at for individual stocks, but can be helpful when looking at the complexion for a broad based index. Often times, markets will overshoot one way or<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[12,42],"tags":[490],"class_list":["post-20286","post","type-post","status-publish","format-standard","hentry","category-markets","category-stocks","tag-stocks","et-doesnt-have-format-content","et_post_format-et-post-format-standard"],"acf":[],"_links":{"self":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/20286","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/comments?post=20286"}],"version-history":[{"count":0,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/20286\/revisions"}],"wp:attachment":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/media?parent=20286"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/categories?post=20286"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/tags?post=20286"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}