Investor Sentiment Check

The market is continuing to probe for a bottom, and a quick check of the investor sentiment indicators supports the thesis of a rally into the close.

For the third day in a row, the CBOE put/call ratio is running above 1.0. Today it is rising to 1.41, a level indicating enormous bearishness.

The ISEE is also plunging to 97, which is the equivalent of a put/call ratio of 1.03. This too is a very bearish level.

The fact that investors are rushing to buy puts when the indexes are barely off their highs tells me that the herd is still not embracing this rally. As such, I continue to believe that buying the dips will prove profitable as the market continues to stairstep to new highs.