Yeah, it’s a nice two day bounce the stock market is experiencing yesterday and today.
But don’t take it for granted because a lot of the stocks you’d think would be rallying, simply aren’t.
And if they are rallying, it isn’t by much.
Discretionary and Technology stocks are quite “bleh” while the leaders are coming from Materials, Energy and Industrials.
Right now, I need to see stronger leadership from our more “traditional” leaders. When that happens, I’ll put more capital to work. For now, I am 20% long and 80% cash.
Below is the SharePlanner Reversal Indicator. Last week we had the downside reversal signaled, and it played out well then, and again this week too. However, it doesn’t mean we will keep going straight down. Instead, I expect the summer doldrums to kick in and we see a lot of sideways trading action as the market tries to digest recent bullishness.
Here’s the Reversal Indicator: