Good Tuesday morning and welcome to Q4. As the always excellent Ryan Detrick points out we just had the best 9 month start ever in an election year, with gains of 20.8% for the S&P 500. 

VRA Market Update

While we’re nearing Extreme Overbought on Steroids (EOBOS) on the majority of US indexes (when bad things tend to happen), the percent of S&P 500 above the 50/200 day sits at 84.2% and 81%. Until these readings top 90%, we will remain aggressively long. Our concern is not the medium-long term, just the very short term (days to approx 1-3 weeks). Again, this is not a sell signal…merely a time to use discipline when putting new money to work. The easy money has likely been made…in the broad markets…for the time being. 

And here’s why; October is the worst month of the year during the presidential election cycle. Will we have an October surprise and if so, what might that surprise look like? The combination of (nearing) EOBOS plus weak seasonality should be respe...