A poll for Nifty forecasts has now closed. There were 259 votes. The question was :
Will the Nifty see 3500 again?
Yes, in the next one year. 36%
No, but 4200 is possible. 37%
No, never. 6%
Yes, but I cannot say when. 19%
Market Sentiment is used as a contrary indicator. When more people are bearish at the bottom, this may well be a sign of a recovery in prices. When more people are bullish at the top, this could be a sign of a decline.
Here, we have a majority of the participants looking for lower levels, when the market is at 15 month highs.
There is also a question about the nature of participation. ‘The public is always wrong at the top or bottom.’ – this is the theory of market sentiment. But, the people who read this blog may not represent the retail ‘public’. They are likely to be professional traders, skilled investors, new entrants in technical trading, – perhaps not repersenting the ‘public’.
Therefore, these numbers will be useful after we do a few months of collecting the sentiment weekly. Then we will begin to find if there is any kind of direct or inverse correlation between these numbers and the future market movement.