12 August 2025
This week’s Heatmaps include new historical buy/sell thresholds for several equity sectors. We’ve also been working on new sector sentiment indicators, which will be rolled out in the coming weeks.
And for the next two Heatmap updates, I’ll be reporting from the beaches of Crete. The plan? Morning analysis, afternoon swims, and just enough sunscreen to keep the laptop from overheating. Hopefully markets will join in the summer mood instead of throwing a tantrum while I’m balancing charts, spreadsheets, and a plate of grilled octopus.
Sentiment
- The payrolls-induced wobble from the previous Friday has been erased—equities are back at old highs, but sentiment is still neutral to slightly bullish.
- The AAII Bull-Bear reading slipped into net bearish territory after last Friday’s sell-off. With markets bouncing back, we’d expect the next reading to return to neutral.
- The New York Fed survey on US consumer expectations for the stock market has rebounded above its historical buy threshold. Consumers now see a 38% chance of a higher market in 12 months—firmly back in neutral territory.
- This narrows the gap with the Conference Board survey, which historically has the better track record.
- Our Risk-On/Risk-Off Heatmap Indicator stays neutral, around the 50th percentile—above April’s lows but below last year’s high-60s.
- The Buy-side Sentiment Tracker (released yesterday) also shows a gradual drift toward bullishness.
- Heatmap shifts this week: 19 bearish vs. 28 bullish.
- Fund flows have been choppy—last week’s biggest bullish mover became this week’s biggest bearish mover.
- Net Call Volumes and Hedge Fund Betas were the biggest movers in a bullish direction.