Should you Sell stocks now or stay put in the stock market?

Should you Sell stocks now or stay put in the stock market?

Editor: Vlad Rothstein | Tactical Investor

Sell stocks now or?

Many readers wrote in stating that they loved the concept of us posting excerpts to other interesting articles. In keeping with that theme, we think the following post could make for a great read. A wide array of topics is covered as we believe that in today’s world of finance everything is interrelated.  Mass Psychology states that if you centre of attention is on one particular target; it is akin to looking at the tree only and forgetting that it is part of the forest.  Lastly, the media is rife with fake newsin reality, the media pushes nothing but fake news for lies sell more than the truth

Markets can remain overbought or irrational for much longer than most bears can remain solvent – this is a very irrational market. The Fed is supporting it and openly encouraging the corporate world to commit fraud by borrowing large sums of money (on the cheap). These funds are then used to buy back shares to manipulate EPS. It, however, also can push stock prices higher.  Many experts state that this market can’t trade higher much longer, but they have been saying that for over two years and counting. Take a look at the chart below, and while we do not wish this outcome for the Dow, it cannot be ruled out. Irrational Markets and Foolish investors; perfect recipe for disaster

Should you Sell stocks now or stay put in the stock market?

They got stock market crash 2017 wrong, and 2018, so will they sing a new song in 2019. So far nothing has changed as we have one expert after another predicting that it is time for the markets to crash; mind you these same chaps sang this same terrible song of Gloom in 2015, 2016, 2017 and so on. It never changes’ “flee for the world is going to end”.  Hahaha, what utter rubbish.

This excerpt from the May 7, 2019 Market Update addresses this issue

In the last update the neutral readings came in at 42, prior to that it was 37, and the one before that came in at 41.00, and you can go back all the way to Jan of this year to see that after bottoming out at 18 (Jan 1, 2019 update), the readings have steadily risen. However, in that same update (Jan 1, 2019), the bearish readings came in at 53, since then it appears that individuals from the bullish and bearish camps have been migrating over to the neutral camp.  

Those that hold out for a meaningful correction might be sorely disappointed as on the monthly charts, the Dow is trading in the extremely oversold ranges, and this could limit the downside action. Individuals that use the term significant or sharp when referring to a correction who are not familiar with the concept of Mass Psychology, usually have floating targets.

For example, before the correction starts, they might be satisfied if the Dow sheds 1500-2000 points, but after the masses are in full-blown panic mode, these guys will jump on the panic train and lower their targets. History illustrates that they will keep lowering the targets until the markets suddenly reverse course, catching them off guard once again. The crowd never wins, and that’s one of the main lessons investors need to understand when it comes to investing.  Market Update May 7, 2019 

Should you Sell stocks now; Maybe You Should Consider Buying

In terms of the stock market, until the Fed changes its mind, all sharp corrections have to be viewed as buying opportunities, and backbreaking corrections have to be placed in the category of “once in a lifetime events”, provided of course the trend is positive. That is what we are here for; to inform you if the trend is positive (Up) or negative (down).

The world is going to witness a Fed that has decided to make a cocktail of Coke, Heroin, Crack and Meth and take it all in one shot. Imagine what a junkie on this combination of potent drugs is capable of doing, and you will have an idea of where the Fed is heading in the years to come.  Market Update Feb 28, 2019, Forever QE & Stock Market Bull 2019

 History States That You Should Buy Stocks When the Masses Panic

Case in point, the backbreaking so-called market crash of 1987 and the even scarier one of 2008.  The chart below clearly proves that being a long term bear is dangerous for one’s financial health

 

Take a look at the gauges below and it immediately becomes obvious that the only ones that are scared are the ones that historically fare the worst. Stock Market crashes should be viewed through a bullish lens

 

 

The long term outlook for the Dow and the overall markets remain unchanged.  On the monthly charts, the Dow is still trading in the oversold ranges, so despite the gnashing of teeth, this current pullback has to be viewed through a bullish lens. The only area of focus, therefore, should be directed at finding the best stocks to get into as stocks are not created equal. Stock Market Crash Date: If Only The Experts Knew When

 

Other Stories of Interest

2018

Is this the end for Bitcoin or is this a buying opportunity? (Jan 24)

Stock Market Insanity Trend is Gathering Momentum   (Jan 10)

Is value investing Dead   (Jan 9)

Irrational markets and Foolish Investor: perfect recipe for disaster   (Jan 5)

Stock market Crash Myths and Realities  (Jan 3)

Bull-Bear Markets & Arrogance   (Jan 1)

2017

Will The Stock Market Crash In 2018  (Dec 11)

Has US Dollar Finally Hit Bottom    (Dec 6)

BitCoin Has Done What Precious Metals Never Could  (Dec 4)

Experts Making Stock Market Crash Forecasts usually know nothing  (Nov 17)

1987 stock market crash anniversary discussions- nothing but rubbish ( Oct 24)