BlogFinancial Markets Gripped by Panic & masses stampeding
Financial Markets Gripped by Panic & masses stampeding
The markets are in an extremely volatile phase; fear is in the air, and it is hard to remain upbeat in such an environment. First of all remember that there is always one very strong correction in a bull market; the problem is that you can never tell which one of the corrections could be strong. If you had reacted like the bears are reacting now in the past when the market appeared poised to correct strongly or crash as the bears would have you believe, you would have been bankrupt several times over. Look at any long term chart and the answer is always the same when the masses are panicking and gnashing their teeth you should be celebrating; end of story.
The masses serve only one purpose, and that is to be used as cannon fodder. You have one choice be one with the masses or be one with yourself.
As the trend is still up in two indices and neutral in one, very strong corrections should be viewed as opportune moments to celebrate. In the short term, this might not be the case, and it is hard to do, but look back at history, anything that is easy to do, does not lead to huge profits. If it is easy anyone can replicate, and the masses never win.
Course of action
The masses are stampeding for the exits, panic has taken over and emotions are now doing the talking. It is ground hogs day all over again and when the dust settles down they will once again regret having bailed out at precisely the wrong time. Learn from history or be doomed to repeat the same mistakes again and again. Panic is the code word for opportunity