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David Bird explains that the NAAIM Exposure Index serves as a weekly survey revealing how invested professional money managers are in the stock market. The index ranges from 100, indicating full investment, to negative values, signaling expectations of market declines.
According to Bird, the index can be considered a confidence meter for market sentiment among managers.
Bird has previously tracked major moves in global markets. He observed that a large pool of global capital broke out from a two-decade consolidation. In another recent note, he highlighted iron ore's strong price breakout on high volume, despite prevailing bearish sentiment and fundamentals, pointing to a potential shift in trading patterns.