The market might have finally begun its long-awaited pullback; some indexes and many leaders have met with some selling pressures in recent days for the first time in months. In the short-term, this selling could easily continue--retreats are rarely over in just a few days’ time. However, with all our market-timing indicators positive and all the major leaders still acting well, the odds favor any consolidation leading to higher prices over time. Thus, your job is to hold on to your best performers but be willing to sell any stocks that act abnormally (to this point, there have been few of those). We did some buying last week in the Model Portfolio, bringing our cash position down to 14% and leaving us with 10 stocks. Some of that buying including averaging up in Equinix, which we write about on page 5. The only other change is putting Cepheid on hold because of its lagging action. All in all, while we’re prepared for some possible hiccups during the next couple of weeks, we also remain bullish and believe the market has more upside surprises in store.
