Bank of America advises preparing for a “summer correction” after record highs

Bank of America 5month 27day, noting the recent sharp rise in U.S. stocks and advising investors to prepare for a possible summer correction. The bank said some technical indicators point to overheating, with the market at a record high. Specifically, it said several technical indicators are signaling that the current upward momentum has weakened.

The bank recommended that investors shift their strategy toward protecting gains on existing holdings rather than blindly chasing additional purchases. The recommendation called for reviewing positions and focusing on risk management. However, it did not offer guidance on individual stocks.

The report cited signs of overheating across the broader market. The report was issued on 5month 27day. It warned of the possibility of a sequential rise in risks, based on investor positioning and technical indicators.

Major U.S. indexes have recently reached new all-time highs. The bank’s recommendation emphasizes that, following these record highs, investors need to shift toward protecting their portfolios. The remarks are not intended to provide immediate trading guidance for the market.