At NDR we take a 360° degree look at factors impacting stocks. Our founder Ned Davis currently rates the tape and momentum as positive. Monetary and macro seem hopeful, given Fed tightening looks done and NDR’s Inflation Timing Model remains on a sell since July '22.
Yet many sentiment and valuation indicators argue we’re getting overbought and overvalued. One could say this has been true for 2-years, but the market hasn’t progressed much over that time. However, Ned thinks there are some good general sentiment indicators which argue there’s still some room for the bulls. One is the Gallup poll on Presidential sentiment (see the chart). Going back to Eisenhower, this still shows a gloomy picture. While this is surprising to most who haven’t studied going contrary to sentiment extremes, it actually leans hopeful for stocks. Suggesting the bulls may have more room despite the excessive investor optimism. To access the full publication please fill out the form to the right, or click here to participate in our trial program.