I posted our first video edition of the market recap on our blog.
Our long-only allocation is now at 50% stocks and 50% bonds. Our model flipped to long stocks on Tuesday, October 21st.
Long-term picture hasn't changed much: large cap stocks are bullish, while small caps are somewhat bearish. We have bought large-cap stocks on Tuesday for a bounce higher and are staying away from small cap stocks for now.
Bonds are bullish long-term reflecting presence of substantial amounts of fear in the markets. Bonds (AGG) are now sufficiently oversold and ready for a bounce higher. Treasuries (TLT) haven't yet corrected to the point where I would be comfortable buying for a bounce higher.
Gold is still bearish. In fact gold miners are holding on for their dear lives. A break below $560 for $GDM could cause a stampede out of the gold equities. An alternative scenario is also possible where gold equities rally from here. Either way, stay tuned.
Commodities may be putting in a short term bottom. Looks like DBC wants to at least stop falling.
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