On a weekly basis Bloomberg News publishes an Oil Sentiment Index. This index measures where institutional traders and investors believe Crude Oil will go over the next week. Last week on Thursday the 7th of February the survey indicated: 4% believed Crude prices will go up, 20% believe prices will stay the same and 76% beleived prices will fall over the next week.
This was the most bearish survey reading since the inception of the Bloomberg Oil Sentiment Index, many years ago.
So What happened since last Thursday?
Since then Oil prices have risen from $86.50 to $95.50, a 9$ increase in price which translates to a 10.4% increase in price of Crude Oil in the span of a week, which is the largest weekly gain in the price of Crude Oil since last November.
In Conclusion, crude oil prices have experienced an out-sized gain, in a period when investors and traders were the most Bearish on prices. So event though the investors and traders are highly educated and have plenty of experience they still fail to properly predict the market direction. In fact, the track record from this and other similar sentiment measure has been surprisingly bad. If anything these sentiment survey are slightly negatively correlated as we seen last week when prices went up when sentiment was negative.
I remember $95 oil. Those were good times.