We are predicting that the S&P 500 will remain range-bound for a while between the June 16 low of 3666 and the August 16 high of 4300. The index closed at 3946 today, around the middle of the range. Sentiment remains very bearish, which is bullish from a contrarian perspective:
(1) The Bull-Bear Ratio climbed to 1.15 this week after falling the prior three weeks from 1.64 (highest since early January) to 1.00 over the period (chart below). It was at 0.60 12 weeks ago, which was the lowest since the week of March 10, 2009’s 0.56.