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The Leuthold Group's Major Trend Index holds at Neutral, even as the technical picture improves. Stocks broke out to fresh all-time highs in early August with broad participation, suggesting a market top is likely still some way off. Beneath a flat surface, though, sharp rotation between cyclical and defensive sectors has driven unusually high volatility, the kind typically seen around V-shaped corrections and recoveries.

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Author: Richard Yasenchak, CFA, CFP®, Chief Investment Strategist