Big Selloff Is Surely Coming ‘Soon’

Stocks have been in an all-out sprint since the first trading day of the new year and are overdue for a correction. Whether frenzied buyers are ready to oblige, if only to preserve a veneer of sanity, should become clearer as the week draws to a close. They looked winded on Thursday but still managed to close the broad averages off their intraday lows. If the Dow were to close unchanged or down slightly on Friday, especially after trading underwater intraday, I’d expect next week to begin on weakness, accelerating into mid-week or beyond. We’ve become so accustomed to seeing every dip get bought with such vigor that we can be certain stocks will fall with unusual steepness the first time bargain hunters are perceived as spent. Any guru predicting this will happen “soon” is not going very far out on a limb.