We would be more apt to book profits this week rather than add to our risk exposure. While not in red territory, the CCM Market Models have reached “Tired Bull” readings.
Given the strength of the recent push higher, there is also ample evidence to suggest an attempt at higher highs may follow any relatively short-term pullback. We will continue to monitor things with an open mind and maximum flexibility, but within the context of a defensive bias until the market shows some strength again.
We have been working almost non-stop attempting to find if/what it may make sense to rotate into (staples? bonds? emerging markets? make no changes?). The market has not shown its hand since we have not seen significant weakness yet (more of a stall). If we pay attention and continue to monitor things closely, we will not stray too far from a prudent allocation.
Profits are hard to come by; we may book some more soon. In the meantime, we will continue with our “where to go or should I stay” analysis. Numerous steps are left to complete this morning (as of 6:45 a.m EDT), meaning we should have a clearer picture over the next few hours.