By John Del Vecchio and Brad Lamensdorf
The riskiest assets have seen a massive rebound.
Many stocks are up 20-30% or more off the recent lows in just a week.
Has the bottom been put in, or is this a bear market rally?
One of our favorite indicators suggests that it is time to add back hedges.
The Short-Term Composite Indicators, courtesy of Investors Intelligence is now exceptionally overbought. At a level of 75.9, we are in nosebleed territory.
The indicator measures dozens of short-term and intermediate-term technical factors. The market is the most overbought it has been in months.
At a level that preceded pain the last time we got there.
While no indicator is perfect, we find that at extreme levels (both overbought and oversold) there are favorable risk/reward ratios. Now presents such a time to fade the market.
To learn more about how these indicators can help manage risk in your portfolio, book a call with Brad.
DISCLOSURE: LAMENSDORF MARKET TIMING REPORT
Lamensdorf Market Timing Report is a publication intended to give analytical research to the investment community. Lamensdorf Market Timing Report is not rendering investment advice based on investment portfolios and is not registered as an investment advisor in any jurisdiction. Information included in this report is derived from many sources believed to be reliable but no representation is made that it is accurate or complete, or that errors, if discovered, will be corrected. The authors of this report have not audited the financial statements of the companies discussed and do not represent that they are serving as independent public accountants with respect to them. They have not audited the statements and therefore do not express an opinion on them. The authors have also not conducted a thorough review of the financial statements as defined by standards established by the AICPA.
This report is not intended, and shall not constitute, and nothing herein should be construed as, an offer to sell or a solicitation of an offer to buy any securities referred to in this report, or a “buy” or “sell” recommendation. Rather, this research is intended to identify issues portfolio managers should be aware of for them to assess their own opinion of positive or negative potential. The LMTR newsletter is NOT affiliated with any ETF’s. Active Alts is affiliated with Lamensdorf Market Timing Report. While LMTR uses charts from SentimenTrader, they do not have a financial arrangement with SentimenTrader Past performance is not indicative of future results.