By Lawrence G. McMillan
For the second time this year, the feature article discusses the overbought state of the stock market. There are quite a few overbought conditions, and all are enumerated in this article. However, overbought does not mean “sell,” unless some actual sell signals are received – which, so far, have been lacking. If they are, a contingent recommendation is offered on page 5.
Our market outlook remains positive, in line with the continuing buy signals from the intermediate-term indicators (page 7).
There are three volatility-based recommendations on page 9: two earnings-based spreads (one in LNKD, the other in APC), plus a hedged trade in COF.
There is one put-call ratio signal – a trade in USO (page 10).
On page 12, the $VIX/SPY hedged strategy is explained, and a new recommendation is made for that strategy, if you didn’t already establish it via the one in last week’s Hotline.
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