Bottom line
- Weight of the evidence had been suggesting high short- to medium-term risk but that has moderated with the pullback and is mostly neutral at this point; still suggesting higher prices long-term
- Dumb Money Confidence exceeded 80% in late August with evidence of skyrocketing speculation, typically a bad sign when combined with an unhealthy environment, though that's turning more neutral; still lots of options market speculation to work off which is a worry
- Active Studies show a heavy positive skew over the longer-term mostly thanks to the March/April/May breadth thrusts, recoveries, and trend changes
- Signs of extremely skewed preference for tech stocks neared exhaustion by late June, especially relative to industrials and financials (here and here)
- Even though volatility has dropped to record lows, investor positioning in bonds has pushed the Risk Level to a very low level; gold has formed a triangle pattern of consolidation so a break there should be telling either way