If mom-and-pop investors are always the last ones to the stock party, then it might be time to call a cab.
Market behavior in recent weeks suggest that after years of running from equities, the retail crowd is coming back in a big way.
Money flowed into stock-based mutual funds last week at a pace not seen in more than four years, and sentiment surveys and volatility measures show there is almost no fear in the market. (Read More: Money Pours Back Into Stocks)
Such periods in the past often have preceded ugly times in the market.
(Read More: What Happened to the Wall of Worry?)
“All the ducks are starting to line up,” said Robert Sneddon, president at CastleMoore, an Ontario-based global asset allocation firm. “But we’re inching along and probably a month away, maybe three weeks (from a market top). You’ve got several things lining up, pointing us in that direction.”