Technology continues to show leadership relative to almost every other sector or region of the globe. If and when a pullback comes, we will be looking to add to our exposure. However, in the short-run our bias will be to reduce risk/sell into strength if we see a weak push to new highs.
Silver continues to underperform relative to what you would expect to see under these conditions. If you own silver (we don’t), it makes sense to have “cut back” contingency plans within reach. Silver is doing things it has not done since 2001 and they are not good things. We hope to see silver pick up since it would be good for risk and inflation expectations in general, but for now it looks vulnerable.
In the next three days, the market will digest reports on durable goods, GDP, and personal income, which will most likely set the short-term tone.
This morning, we are working on the “false bottoms” portion of the new risk model.