You’d think with stocks ripping to fresh highs, the mood out there would be euphoric. Confetti. Champagne. Victory laps.
Instead, it feels like the opposite.
Just yesterday, the S&P 500 closed at a new all-time high. So did the Dow Jones Industrial Average. So did the Nasdaq-100. The NYSE Composite too.
And globally? The All Country World Index also set a new record close.
The trend in stock prices is undeniable: up.
Yet sentiment? It’s still weighed down by pessimism.
Half of all individual investors polled by the American Association of Individual Investors (AAII) say they’re bearish on the next six months.
Half!
That’s now six straight weeks where bears have outnumbered bulls — even as the major indexes march higher week after week.
New Highs Are Characteristic of Uptrends
After not making any new all-time highs until very recently in 2025, the Dow has been on a tear over the past few weeks, closing above 46,000 for the first time in history:
The Dow Jones Industrial Average now joins the S&P 500, the Nasdaq-100, and many stock market indexes in new all-time high territory.
That’s the type of thing you normally see in healthy market environments.
What you also typically see when good times are here to stay is disbelief.
Look no further than the latest AAII data, where you can see half the respondents are somehow bearish about the stock market over the next six months.
Here’s the screenshot directly from the AAII website:
What are these folks so scared about?
It’s fascinating to see how much pessimism is out there among individual investors, considering just how well stocks are doing.
Here’s a zoomed-in look at the historical data of this poll, showing the most bearish readings since early May:
Keep in mind that those readings throughout April and into early May were some of the most bearish readings in history, and this data goes back to the 1980s.
You saw the epic ripper in stocks since then. But individual investors have only gotten more bearish.
That’s called disbelief.
Breadth Expansion
When true market tops form, the cracks usually show up beneath the surface first.
Breadth weakens. Fewer stocks make new highs. Fewer stocks hold their uptrends. The indexes might still grind higher for a bit, but under the hood, participation is already deteriorating.
That’s not what we’re seeing today. It’s actually the opposite.
Right now, the percentage of NYSE stocks trading above their 200-day moving average is the highest it’s been all year.
That’s expanding breadth, not contracting.
And it’s not just a U.S. story. Globally, the All Country World Index ex-U.S. (ACWX) just closed at fresh all-time highs.
This isn’t the type of action you see at major tops. It’s exactly what you expect to see in a strong, healthy bull market:
When you weigh all the evidence, the question becomes simple: Where should we focus our time and capital?
Should we be hunting for shorts and scrambling for “safe” alternatives, or leaning into strength and finding the best stocks to own?
The data makes the choice clear.
Prices are trending higher. Breadth is expanding. Pessimism is still everywhere. That’s fuel for further upside, not evidence of a top.
The trade hasn’t changed: Stocks are going up, and the crowd is still fighting it.
That’s exactly the setup we want.
And until the evidence says otherwise, I’m sticking with it.
Stay sharp,
JC Parets, CMT
Founder, TrendLabs