Is the stock market rolling over for a bigger correction, or is all this bearishness a buying opportunity? That is the million dollar question. What do the internals say?
This is the 8th 5% pullback since the 3/09 bottom already! A series of lower higher lows and high for a month…. New highs disappeared, new lows expanded. These are not good signs.
The A/D line hit a recovery high just two weeks ago. The yield curve is still steep. The Wall of Worry is as high as ever. These are good signs for sure.
The answer is: this is not an easy time to trade or invest. It’s not clear what this action represents, in my opinion. Clearly we are in a tug of war between the Bull and the bears. The bear citing in NJ yesterday on my street was clear, the one on Wall St was less clear. As I put the final touches on the Magnet newsletter, I still see plenty of good stocks that fit in my model portfolio.
My guess is that the market won’t give a lot- to either the Bulls or the Bears. The best stocks to own are easiest to find in markets like this. Now is not a good time to be overly aggressive, but I still do not want to ignore alerts as they go off.
NVMI, CROX, OVTI- all will make the newsletter cut here…
