Two of the sentiment indicators that I watch closely are the Investors Intelligence report and the Rydex Nova/Ursa ratio.

To review, the Rydex family of funds has the Nova Fund which is a bullish fund and targets a return that is 150 percent of the return of the S&P 500. The Ursa fund is a bearish fund and targets a negative 100 percent correlation to the S&P 500.

The ratio is simply the assets of the Nova fund divided by the assets on the Ursa fund. The higher the ratio, the more bullish investors are and the lower the ratio, investors are more pessimistic.

In the last month, the Nova/Ursa ratio has jumped from 0.29 to 0.44. This is the highest reading for the ratio since mid-November when it hit 0.46. This tells us that investors are becoming more bullish.

The Investors Intelligence report measures the bullish and bearish percentages of investment newsletters and it recent weeks it has seen the optimism fade a little.

In mid-February, the bullish percentage spiked to 54.8 percent which was its highest reading since last spring. Over the last three weeks the bullish percentage has fallen to 47.9 percent. This move indicates that newsletter publishers are becoming more cautious.

With these two indicators heading in different directions and the volume pathetically low, I think there is confusion and indifference in the market right now.