Sentiment Is Too Bullish, but I'm Not That Worried

With the Fear and Greed Index tagging 95 this past week and the Daily Sentiment Index (DSI) at 89, there are two questions I have been asked repeatedly. The first is that Fear and Greed and DSI were here in mid-July and I was quite cautious in mid-July, so why aren't I so cautious now? And the second is related: what would it take to turn me cautious?

I am going to answer the two questions together. Let's start with why the market now looks different than it did in mid-to-late July, when we last saw these similar sentiment readings. Let's begin with one of the easiest charts to see the difference on: The ratio of (IWM) to (QQQ) (small-caps to big caps)....707 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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