Prediction.
The S&P 500 Is So Far Above Its Moving Averages That a 10% Correction This Summer Is Not Out of the Question Quick Read – The S&P 500 has stretched 10-15% above its key moving averages, with the Nasdaq-100 surging 17.35% in one month and momentum indicators like the 14-day RSI staying above 70 overbought levels for over a week. – Mean reversion toward 6,850-6,900 is likely as stretched valuations and extreme positioning in technology stocks have decoupled from underlying economic improvements for average Americans. – RIA Advisors’ Lance Roberts trimmed mega-cap winners Alphabet (GOOGL) and Microsoft (MSFT), while rotating into defensive plays like RTX (RTX) and Eli Lilly (LLY). – The analyst who called NVIDIA in 2010 just named his top 10 stocks and Invesco QQQ Trust wasn’t one of them
Get them here FREE. Lance Roberts of RIA Advisors warned on the Thoughtful Money podcast that the S&P 500 has stretched so far above its key moving averages that a mean-reversion move could be a higher-probability scenario heading into the summer. “The big risk here is right now… we’ve got this massive deviation that’s going on kind of in the markets. You know, we’re so far deviated above the 50, 100, 200-day moving averages.
You’re going to correct this,” Roberts said. The Market Is Getting Dangerously Stretched Roberts outlined a specific downside scenario for the market. “You’re talking about potentially a corrective action this summer between 6,850 and say 6,900 would not be outside the realm of possibility,” he said, adding that “a 10 to 15% pullback would not be out of the ordinary.” The S&P 500 currently trades around 7,400. The analyst who called NVIDIA in 2010 just named his top 10 stocks and Invesco QQQ Trust wasn’t one of them.