Sentiment Indicators Suggest Continuing Stock Market Volatility
Sentiment Indicators Suggest Continuing Stock Market Volatility. Short-term investor sentiment indicators were back down in overbought territory late week. They showed some initial investor nervousness earlier in the week. This amid the uncertainty over US-China talks that triggered a sharp market drop.
The VXX volatility index, for instance, moved higher then started down again later in the week. This indicated that investors were betting on lower volatility. That’s a signal for caution since we used sentiment as contrarian indicators.