Stimmung an der Börse dreht sich: Anleger sollten jetzt Gewinne mitnehmen

The euphoria that has persisted among investors for weeks is a warning signal. A negative message is now enough to end the rally.
Düsseldorf A trend reversal is in the offing at the stock market mood. "The ongoing euphoria now calls for positions to be reduced and profits to be taken away," says Stephan Heibel after evaluating the latest Handelsblatt survey Dax-Sentiment.

Just a week ago, the owner of the Animusx analysis company advised "to set stop loss brands generously" and not to sell in a correction, but rather to increase it.

But the overall good mood on the stock markets has been going on for many weeks, which, according to investor sentiment, is an indication of prices falling soon.

Because in an euphoric mood, many investors have already bought shares and can no longer offer support when prices fall. But such a good mood can last longer, so the prices continue to rise before overheating calls for caution.
"That is why it makes little sense to speculate about when this rally will end," said the sentiment expert. He advises investors not to sell everything: "Stay with it, because in a bull market like now a possible correction can take place faster than many private investors can then buy again."
But if you have high book profits in your portfolio, you should ask yourself how much of these book profits you would like to risk if the markets should turn. Perhaps it was time to halve one position or the other and secure the rest with a stop loss.

As a result, investors can continue to participate in the rally, but have generated a little cash to buy shares that would be particularly badly affected by the sell-off in the event of a setback.

Basically, the most beautiful of all worlds prevails on the stock markets: The central banks in Europe and the USA are currently not making any move to increase the key interest rate. On the contrary, further liquidity measures are still being discussed.

Meanwhile, there are clear signs of the economic recovery in Germany, while the good economy in the USA is impacting on wage levels and, according to new reports, even narrowing the gap between rich and poor. China has collapsed in the trade dispute, the US will continue to impose punitive tariffs until the agreements are implemented.
This rally can run even higher if there is no serious event. But the corona virus, for example, could end the stock market celebration abruptly if a pandemic should occur.

“The rally goes on for a long time without a serious event,” says Heibel. "But there are countless possibilities." One of them could happen next week: Facebook and Apple will then publish their quarterly figures. The expectations are so high that it will be difficult for the two companies to surprise positively.

But should the two heavyweights lose their feathers, they pull down a whole series of indices.

As expected from Heibel last Monday, the continued good mood hadn't hurt the Dax in the previous week. The index rose another 0.4 percent.

The latest survey results also show euphoria. The mood remains stable at a high level. However, complacency declines slightly, based on the answers to the question: "Have your expectations regarding the Dax been fulfilled in the past week?"

"It seems that despite the great optimism, some investors have been surprised by the fact that the new all-time high in the Dax has actually been reached," says the Animusx managing director.

ZEW economic expectations jumped to a new high in four and a half years in the past week. This also has an impact on the future expectations of investors: optimism, which has traditionally been rather cautious in Germany, is increasing slightly this week. Willingness to invest is also increasing. Even new commitments at an all-time high are now an option for investors.

This mood is more evident among institutional investors who secure themselves through the Frankfurt derivatives exchange Eurex: with a put / call ratio of less than 0.6, the professionals are extremely bullish.

By contrast, the Stuttgart Euwax sentiment, on which private investors trade, only indicates a neutral condition.

The all-time highs are also pulling investors into the US. On the other side of the Atlantic, the put / call ratio of the Chicago futures exchange CBOE is also at an extremely low level, the lowest in two years. "In the US, you weigh yourself on the long side in safety," explains Heibel. "This is a first warning signal."

The put / call ratio, which is shown separately for stock transactions in the United States, is the lowest in four years at 0.5. For a long time now, there has been no speculation for stock profits with the help of call warrants.

The put / call ratio for indices has also declined sharply, but is still at a high level.

That means: In the US, there are currently more investors speculating on individual shares than they have been in a long time. The focus here is on increasing prices. At the same time, the hedges against price losses that can be realized with index speculation decrease. "The safety net is slowly being removed," he explains.

The other data in the US also caution: US fund managers have put 93 percent of their funds into the market. That is a very high investment rate compared to the last two years.
For comparison, the investment rate was 120 percent at the end of 2017, when Trump announced the U.S. corporate tax reform. It was the highest investment rate ever measured. This was followed by a violent sell-off at the beginning of 2018, when institutional investors wanted to hedge themselves with volatility products and thus drove the market into the basement very quickly.

The bull quota in the US is a high 21 percent. The “fear and greed indicator” of the US stock markets, based on technical market data, has, however, returned significantly after several weeks of extreme greed.

Heibel is not alone in his assessment. According to the investment advisory firm Sentix, the consolidation of the US markets that started last Friday should not be over yet.