This just in. We are now back at 5/25 levels for the S&P 500. From Tobias Levkovich at Citigroup, as reported by Business Insider:
Last Friday our panic-euphoria model, one of our proprietary sentiment models went into panic, that gives us a very high probability, almost 90 percent probability that markets are up in 6 months, and 96 percent probability that they’re are up in 12 months.
I have no idea how they come up with those probabilities, but it would be nice if it’s true. More generally, other analysts have also found a correlation between very negative investor sentiment and higher markets 6-12 months later.
