What is American Association of Individual Investors (AAII) Sentiment Survey

According to Wikipedia, the free encyclopedia, American Association of Individual Investors (AAII) is a nonprofit organization whose purpose is to educate individual investors regarding stock market portfolio, financial planning, and retirement accounts.

AAII’s Sentiment Survey, which is surveyed on its members’ view (bullish, bearish or neural) opinion where the general market will be at. It is released weekly. This reading is treated as one of the best of contrarian indicators. It is similar to the technical indicator ISE Sentiment Index (ISEE) which is measured on the retail investors, and is considered as a contrarian indicator.

The above figure shows 45% of AAII’s members present bullish view of the stock market in the six month. On the other hand, 29% members reveal bearish view.

According to my trading log, bullish sentiment greater than 45% is treated as a high reading. It might foreshadow a temporary reversal. Especially it had reading as 45% last week as well. However, we need to combine AAII sentiment survey with other technical indicators to better gauge the market movement.

Thanks for your visiting and reading. If you want to know more about ISE Sentiment Index (ISEE), you can visit:

http://top5indicators.blogspot.com/2013/09/how-ise-sentiment-index-correlates-with.html

http://top5indicators.blogspot.com/2013/09/how-money-makers-squeeze-retail.html

http://top5indicators.blogspot.com/2013/09/how-to-avoid-herd-moves-in-stock-market.html

http://top5indicators.blogspot.com/2013/09/how-to-combine-ise-sentiment-index-and.html

http://top5indicators.blogspot.com/2013/09/how-to-detect-market-reversals-by-ise.html

http://top5indicators.blogspot.com/2013/09/how-to-detect-short-term-market.html

http://top5indicators.blogspot.com/2013/09/how-to-interpret-ise-sentiment-index.html

http://top5indicators.blogspot.com/2013/09/how-to-obtain-ise-sentiment-index-data.html

http://top5indicators.blogspot.com/2013/09/how-to-profit-from-stock-market-by.html

http://top5indicators.blogspot.com/2013/09/why-ise-sentiment-index-isee-only.html

Source: http://www.aaii.com/