The number of bulls in the latest advisor sentiment from Investors Intelligence continued to rise as investors have been encouraged by the recent rally in stocks.

“For the fourth straight week there were more bulls at 44.2% from 43.2% last week and 34.4% three weeks prior to that. That low reading (and it was also 11.9% below the bears) coincided with the yearly lows for most indexes and indicators. The bulls jumped after the market lows but with a now 10% gain the pace of the increase has slowed,” Investors Intelligence said in a report Wednesday.

“The current level for the bulls does not suggest an end to the market advance and their number should exceed 50% before we even contemplate a potential top,” the newsletter service added. “The averages are still well below their April and July 2011 highs. Those levels had the bulls above 50%, with their peak at 57.3%.”

SPDR S&P 500 (NYSEArca: SPY) has jumped more than 10% over the past month on improving economic forecasts and hopes Europe will sidestep a full-blown debt crisis.

However, the exchange traded fund slipped over 2% on Wednesday as surging Italian bond yields signaled fresh jitters over Europe’s debt logjam.

Investors Intelligence said the number of bears fell again in the latest week to 34.7% from 46.3% to start October. “That was the most bears since Mar-09 when they peaked at 47.2%. That high reading signaled that the advisors were raising cash,” it said.

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