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| In bullish cycles the market can remain overbought for extended periods of time. |
The far-right green bar in the Snapshot came down to about the 13% level. This tells us that last week's very overbought condition was somewhat relieved today.
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| Market Direction Model All Green on 01 23 2012 |
The Market Direction Model remains positive. I suspect any pullback would be bought with this kind of underlying market strength.
Equity Sector Rotation
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| Money continues to rotate out of the defensive sectors, consumer staple and utilities. Energy stocks are coming back into vogue. |
Additionally, I took a full position in GLD (Gold bullion ETF) in the GWM Inflation Hedges folio.
Flexible Income Sector Rotation
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| Preferred Stocks and Convertible bonds remain the place to be. Junk Bonds have been gaining strength. I will be looking to take another inverse position in US Treasuries if they continue to slide. This blog post does not constitute an offer of investment advice. This blog is only provided for educational purposes. Please read the Important Blog Disclosure posted in the right channel bar. |
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