In the short-term, last week’s quick re-test of the market’s crash lows could lead to a bounce of a few days or even longer; stocks have certainly become “oversold” enough to move higher for a bit. But all of our market timing indicators remain negative, so it’s likely any bounce will fail, leading to further downside (or, at least, bottom building) in the weeks ahead. In the Model Portfolio, we sold more stock since the last Letter, leaving us with a huge 75% cash position. That seems high, and if you want to nibble on the long or short side to try to play any short-term movements, that’s up to you. But the main goal is to preserve capital for the next low-risk buying opportunity. In tonight’s Letter, we write about playing the short side on page 5, and have some pieces of advice if you choose to venture there. We also highlight one of our favorite growth stories on that page, as well as some resilient stocks on page 4 (including a couple of precious metals leaders).
