Waiting for a Cycle Turn
Our risk matrix has dialled back up to 'Extreme Greed' territory. We remain cautiously long but the rally is a double edged sword. Signs of a correction are yet to emerge and be confirmed. The irony is that the correction, when it does emerge, may be swift so vigilance and tight stops are appropriate as we may not get an opportunity to write about it in time. Risk needs to be managed actively at current levels. Our feature chart this week looks at the S&P relative to the NASDAQ for those who prefer a more market neutral approach.