“We were struck by your caution in y'days audio about re-entering equities now after back broken on 200 DMAs Clients may benefit by dollar averaging perhaps???...50 now 50  later??  Grateful for your views”

David Fuller's view

Over the last two years, investors in the US and many of the other better performing stock markets have been conditioned to buy on setbacks towards the 200-day moving averages.

However, when Wall Street indices break most of their uptrend consistency characteristics, as we have seen recently, this service takes a more cautious view, especially when leverage (margin debt) is so high, as I have been pointing out.  When technical damage occurs following a big move to the upside, the possibility of a bigger setback increases.  Until markets are lower and/or technical damage is repaired, I prefer to wait for an even better buying opportunity.  However, if your favourite Autonomies have fallen back to PERs that are clearly lower than their broader indices and their dividend yields are both attractive and well covered, the prospect of another stock market shakeout holds less risk.  Nevertheless, I would retain some cash, just in case we see a temporary panicky overreaction to the downside.