Investor expectations have risen to extreme levels.  Here’s a short take from AAII:   The percentage of individual investors expecting stocks to rise over the next six months is at a level not seen in more than three years. At the same time, the latest AAII Sentiment Survey shows pessimism at its lowest level in more than two years.

Bullish sentiment stands at 59.8% while bearish sentiment has fallen to 15.6%. 

The last time bearish sentiment was this low was back in November of 2015.  The first six weeks of 2016 where very weak.  After bottoming mid February, after a 14% pullback from the December 2015 highs, the S&P 500 Index moved steadily higher through year end.

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We may experience some bumps ahead, possibly a significant pullback developing later this month.  As in early 2016, we believe it would provide a buying opportunity. 

Here’s more from AAII.com:   http://www.aaii.com/o/sentimentsurvey

Chart courtesy of Helene Meisler