The investment strategist that nailed the stock market bottom in June says risks are skewed to the downside as investors fight the Fed

It's difficult to navigate the ups and downs of the stock market in a bear market that has already seen three separate rallies of 10% or more that failed and resulted in lower lows.

The stock market presented a rare buying opportunity after the S&P 500 flashed one of the most extreme oversold readings in 30 years, according to the Truist Bank co- CIO.

Some investors are wondering if this is another head-fake rally or the start of a new bull market after the S&P 500 and the Nasdaq 100 both rose 20% in the last month.

As the risk-reward profile of the stock market favors the downside, it's probably another head- fake rally.

The S&P 500 is likely to consolidate sideways, sandwiched between its rising 50-day moving average and falling 200-day moving average, as a likely scenario in the short term, according to an interview with Insider.

At the same time the S&P 500 is running up against technical resistance, valuations are "full" and the Federal Reserve is expected to continue to tighten monetary conditions via interest rate hikes and a reduction in its nearly $9 trillion balance sheet, which is just starting to get underway, according to

Friday's strong jobs report only reinforces the idea that the Fed is likely to continue hiking rates for the foreseeable future, despite some interpreting Chairman Powell's comments in July as a potential pivot.

The V-shaped recovery in stock prices investors have grown used to is unlikely to happen this time around due to central bank tightening and valuations being not that compelling.

Lerner's approach of combining both fundamental and technical analysis in his research process means he's not oblivious to the possibility that resilient corporate earnings and improving economic data could lead to a move higher.

Where would we be wrong? More than a Fed pivot is that the chances of a recession is less than half.

The Fed made a soft landing.

A lot of the weakness we've seen is a symptom of the unwind of the huge stimulatory effect. The bull case is that earnings are going to stay better than expected.

Technology has been upgraded to neutral by Lerner as it shows signs of a comeback amid easing inflation expectations and a decline in interest rates.

We are looking for more of a digestion period for the big cap tech stocks for an opportunity to upgrade again.

The healthcare sector is an attractive area that has growth and value characteristics and tends to do well in a choppy market environment.

As investors navigate the ongoing volatility in markets, there's no reason to be a hero at the moment.

"For investors who are over allocated to equities relative to their long term targets, our view is this would be a more reasonable place to trim exposure."