Waiting for a Buy Signal

The August-September seasonally weak period for stocks seems to be in play. The main reason offered is heightened US-North Korea tensions but the fact of the matter is bullish sentiment simply reached an extreme (see Rydex Trader Bullishness Surpasses 2000 Tech Bubble) and, as a number of strategists and market technicians have been pointing out on our show, this meant conditions were ripe for a correction regardless of the exact catalyst.
With that said, if Barry Bannister is correct in his call for a near-term market top from current levels followed by a major peak next year with a bear market and recession in 2019 (see Barry Bannister’s Macro Outlook), investors are likely to be presented with at least one more major buying opportunity in the weeks and months ahead.
Here is one such indicator we use at our firm for attractive intermediate-term (multi-month) entry points:

This post was published at FinancialSense on 08/10/2017.