'Dumb Money' Returns to Stocks

I don't think so. Timing is everything in this business. It is the skill that separates the masters from the apprentices.

Capital, following historical precedence, is moving into stocks during periods of aggressive currency devaluation. Recent money flows suggest that connected and retail money remain bullish and neutral, respectively.

The fear of retail money – “dumb money” aggressively chasing strength is not supported by the leveraged money flows. Retail money, despite the suggestion below, has been selling strength since October.

When “dumb money” goes "all-in" statistically, it will be time for concern. That time, however, is not now.

S&P 500 and and the Nonreportable Traders COT Futures and Options Equity Diffusion Index (DI):

Individual investors are wading back into the U.S. stock market. That ought to make über-bulls think twice.

Positive forces including strong corporate earnings, improving economic data and more bond buying by the Federal Reserve have fueled a 17% rally in the Standard & Poor's 500-stock index since late August. The market has now punched through its prior 2010 highs, set in April, to reach levels last seen in 2008 before the collapse of Lehman Brothers.

Source: finance.yahoo.com