I expect a market pullback

Author: Ronald Guerrini

Covestor model: Breakouts and Reversals

This year has started well for equities and for my Breakouts and Reversals model portfolio, which returned 5.9% for the month vs. the S&P 500’s 4.4%.

The model tracked lower for most of the month, but was boosted by the holding of takeover target Solutia (SOA), which jumped over 40% after the unexpected news was released to the market.

While the trend remains up, equities appear to be over-extended and I expect February to be a month of consolidation or retracement.