How to read market sentiment
Sentiment is most useful at extremes and when it disagrees with price. A market at its highs on narrow breadth and little fear is a different setup from the same price level with broad participation. These measures describe how stretched things are. They do not time a turn.
What is the Frenzy Index?
The Frenzy Index is our fear and greed gauge for the US stock market. It runs from 0, extreme fear, to 100, extreme greed. It averages six measures of how investors are behaving: momentum, breadth, new highs against new lows, volatility, credit demand, and stocks against bonds.
How is the Frenzy Index calculated?
Each of the six measures is ranked against its own past year of daily readings, which gives it a score from 0 to 100. The index is the plain average of those scores. A reading is unusual only by the standards of the past year, so the index adjusts as markets change. Below 25 is extreme fear, 25 to 45 is fear, 45 to 55 is neutral, 55 to 75 is greed, and above 75 is extreme greed.
Is extreme fear a good time to buy stocks?
Not by itself. Extreme readings show that positioning and prices are stretched, and contrarian investors watch them for that reason, but fear can deepen for weeks before it turns. Treat the index as context for a decision, not a signal. Nothing on this page is investment advice.
What does the percentage of stocks above the 200-day average show?
It shows how many S&P 500 stocks are in a long-term uptrend. A market near its highs with few stocks above their 200-day averages is being carried by a small group, which is a weaker footing than a market where most stocks are rising.
What are COT commercials?
The Commodity Futures Trading Commission publishes the Commitments of Traders report each week, showing who holds futures. Commercials are hedgers with business exposure to the underlying market. We show their net position in E-mini S&P 500 futures and rank it against about three years of reports, because the level alone means little.
What is GDPNow?
GDPNow is the Federal Reserve Bank of Atlanta's running estimate of real GDP growth for the current quarter, updated as economic data comes out. It is a model estimate, not an official forecast or a Fed projection.
What is fund manager positioning?
It is the net position of asset managers in E-mini S&P 500 futures as a share of open interest, from the Commodity Futures Trading Commission's weekly Traders in Financial Futures report, ranked against about three years of reports. It shows how much long exposure large funds hold through futures. It leaves out the stocks they own and can include hedges, so it says most when it changes quickly or reaches an extreme.
What is retail positioning?
It is the share of trading in leveraged and inverse ETFs that goes to the funds betting on a rise, over five trading days, ranked against about three years. These funds are popular with individual traders, so the split is a rough read on their mood. It comes from trading activity rather than from asking anyone, and professionals trade these funds too.
How often does this page update?
The Frenzy Index and the price-based indicators update hourly during market hours, and the day's final reading is set after the close. The COT report and fund manager positioning are weekly and GDPNow changes as new data arrives, so each row shows its own date.