This sell-off has more to do with overvaluation than the economic impact of coronavirus. There is a much wider set of anxieties around stock prices. The virus fears will have longer-term economic impact due to china’s slowdown. But for now, we are focused on taking advantage of a long position and exploiting and taking advantage of the herd running for the exit.
There is no question that excessively high valuations rests on an artificially engineered low interest rate bubble. For now, there will soon be an opportunity to buy into this market. Stay tuned for our next entry signal of SPY with ETF Trade Advisor system trading approach.