Charles Schwab’s Liz Ann Sonders says that the risk of a correction is elevated, but she thinks the bull market is still in tact.

“US stocks have been resilient, although there has been an uptick in volatility,” Sonders writes along with Brad Sorensen and Jeffrey Kleintop in commentary on Schwab’s website. “Economic data has shown some softening, but we believe it is temporary in nature. However, the risk of a correction is elevated in our view and investors should be prepared for such a possibility by having a diversified portfolio and keeping a close eye on rebalancing opportunities after pullbacks. Meanwhile, investors should also look overseas for global diversification opportunities as monetary policy easing should help to bolster asset values.”

Sonders, Sorensen, and Kleintop say that both valuations and sentiment are on the high side, which raises the risk of a pullback. But they say that recent weakness in economic data shouldn’t be too big a concern. “Much of the weaker data recently appears tied to severe weather in the east, the port shutdown in the west, and sharply lower energy prices that have caused some dislocations in the manufacturing sector,” they write. “These shorter-term factors are also behind the sharp reduction in corporate earnings estimates, which actually may help to support stocks due to lowered expectations. … But the weakness in some economic indicators and earnings is not likely due to heightened recession risk given still-strong leading indicators.”