Could very well be that the nassacre is just delayed, but I am almost ready to defenestrate the nassacre scenario out of the window.
Few things to note. The economy i still in "goldilock" mode, with employment behaving relatively nicely, thus delaying any possible consumer retrenchment.
The semi equip BTB at .80 is mildly bullish, sure it can go lower, but the behavior of the sox in face of the recent low BTB indicates to me we are closer to a through in that sector than a top, note how KLAC reused to revisit the $40 area and instead launched to a new recent recovery. Since we never got a really deep decline in the BTB, we may not get a sharp advance there either. That reinforce a model that includes rather than a very sharp retrenchment modest advances and declines.
Last the failure to get any extreme readings (either excessive bullishness, or excessive bearishness) in sentiment indicators, point to a period of less volatility (see the anemic VIX/VXN charts, even during periods of big declines as we had the one day wonder last week).
So, if we do not get excess optimism on the next ramp (and that ramp takes the dow to recovery highs), I will defenestrate the Nassacre model out of the 10th floor window.
I am still at a "neutral" like exposure at 44% cash here.
