Taking some profits….

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In my June 25th post  I explained why I was a buyer of the dip in the markets.  I purchased several ETF’s on that day at a time when the S&P was trading at the 2710 area.

Today I took profits on those positions as soon as the S&P hit 2790.  I didn’t anticipate this level so quickly.  I was a little early in buying the dip and I’m probably early at taking profits.  Don’t think for a moment that I feel this rally is about to end.  Quite the contrary,  I believe this rally will extend to the 3100-3200 area (basis the S&P 500 index).   I took profits because the market is overbought in the short term and a 50% retracement of this recent rally (or 40 points in the S&P) would be a healthy pullback and not at all unusual.  We are far more likely to see new highs than new lows.

I’ll be looking to re-enter ETF’s on this forthcoming pullback.

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