With the increased volatility that we have been seeing in equities, it should come as no surprise that investor apprehension is on the rise, and that is exactly what we have been seeing in sentiment readings from the American Association of Individual Investors (AAII). According to this week’s survey results, bullish sentiment declined from 38.4% down to 35.4%. This represents the fourth straight week that bullish sentiment has been below its bull market average of 38.75% and the fifth weekly decline in bullish sentiment in the last six weeks.
Hand in hand with the decline in bullish sentiment, we have also seen an increase in bearish sentiment. In this week’s survey, bearish sentiment rose from 24.4% up to 32.0%, which is the second highest reading in bearish sentiment for 2015. That 7.6 percentage point increase was also the largest weekly jump since 2/5. Investor sentiment is still far from being considered bearish, but bullish sentiment has all but evaporated.