This week’s sentiment survey from the American Association of Individual Investors (AAII) was unique in that both bullish and bearish sentiment saw their largest one week declines in over a month. In the case of bullish sentiment, the percentage of bulls declined from 35.4% down to 28.7%, which is right near the lowest levels we have seen in a year. At the same time, bearish sentiment declined from 31.96% down to 24.15%, which is actually right near levels we were at two weeks ago.
So where did all the bulls and bears go? They went neutral. As the chart below indicates, neutral sentiment shot up from 32.65% up to 47.15%. This was the largest one week increase since June 2004, and the highest level since February 2003. That’s a pretty big spike in indifference in just one week’s time.