Risk of a Pullback Increasing as Bullishness Grows

The crowd is getting overly bullish here and that makes us a bit nervous. Price could certainly continue to climb from current levels. In fact it is likely. The risk of a quick reversal triggered by profit taking increases with each higher high the market makes here however. We consider a pullback to be a buying opportunity, but keep in mind that bull markets sometimes experience sharp pullbacks that trigger stops and frustrate traders. Our time frames are not long term so a pullback that is too sharp can quickly wipe out profits on the table. For the reasons stated here it is better to stay conservative until the market pulls back and provides better entries.