Originally published August 11
Executive Summary:
Both the Early Warning board and my favorite stochastic indicators suggest that stocks are overbought. As such, one can argue that "the table is set" for some downside action. However, I will opine that we've got a "good overbought" condition on our hands. And given that the news on the virus, earnings, and economic fronts have been largely BTE (better than expected), investors continue to put money to work into any pullbacks. As such, a "buy the dip" strategy would appear to remain appropriate in the current environment.