Market Rally: Will the Market Rally This Summer

Market Rally

Market Rally: Strong, Soft, or a Dud? Decoding the Dynamics

There is too much money out there for it to go anywhere else but the markets (and no matter what the experts state, the worst stock crash in history proved to be a buying opportunity. Nothing has changed since the great depression other than the money supply increasing a thousandfold—the greater the deviation, the better the opportunity. The best place for the smart money to expand its already large war chest is via the stock market. The odds strongly favour a market rally this summer, which will likely be fast and furious.

Monthly chart of KMB

Here is another dull stock (Monthly chart of KMB); if you purchased it close to its highs in 2008, you would still be holding onto 100% gains. If you employed DRIP and the other tactics that are discussed in the forum (selling covered calls and cash-secured puts), you would be up even more. If you sold cash-secured puts and used some of the proceeds to buy calls, you would be holding a mini-fortune.

Investors have a topsy-turvy view of the World. When it comes to investing, crashes should be viewed as manna from heaven, giving you the chance to buy top companies at a discount. Instead, most panic and press the sell button. Investors need to understand this simple slogan; buy when there is blood in the streets and panic when the masses are joyful. Market Update June 15, 2022

Hence, while everyone thinks the markets will crash this summer, the unexpected outcome is likely to come to pass. Therefore, expect the markets to rally robustly this summer.

Wise words from a veteran investor

‘You must learn to control your fears,’ says investor Warren Kaplan, who uses stock dividends to his advantage and sticks to a disciplined sell strategy

Kaplan is an 85-year-old individual investor with 70 years of stock-trading experience. Kaplan grew up in a poor family in the Bronx, N.Y., but by sticking to four straightforward stock-market strategies through bull- and bear markets, he’s built a comfortable life for himself and his family.

Buy and hold (but not forever): Unlike many investors who buy and hold indefinitely, Kaplan holds stocks until the market environment changes. That catalyst could be a change in management, a dividend cut, technical weakness, poor earnings or overvaluation. If any of these scenarios occur, Kaplan may reduce his holdings or sell all of his shares. .

Sell covered call options: Kaplan regularly sells covered calls on his dividend-paying stocks. Selling covered calls generates a premium and allows him to sell stocks at a price that he specifies. After the stock is automatically sold (according to option rules, it is “called away”), Kaplan waits for a lower price and buys the stock back. Then he sells another covered call. https://cutt.ly/pKqdQTJ

The last point is something traders need to start learning. We have mentioned selling covered calls but selling cash-secured puts is just as effective as generating income.

Stock markets may have become too pessimistic about corporate earnings despite the gloomy outlook for the global economy, according to Sanford C. Bernstein strategists. https://cutt.ly/qKqs7jR

Stock markets always overshoot in both directions (upside and downside) due to the massive amounts of hot money in circulation. As the markets have overshot to the downside, the next market rally will be more potent than most envision.

It’s painful currently but tell me when has any correction been pleasant. Even more unpleasant is knowing you gave in to fear and dumped your shares at or very close to the bottom. No bear market marked the end of the financial system, an irrefutable fact that no one alive can dispute.

Other Articles of Interest

market cycle

Teaching Kids about Investing: Navigating Market Cycles

 The Importance of Understanding Market Cycles Mar 31, 2023 Intro to Market Cycles  The stock market is an excellent investment ...
Long-Term Gold Targets: Exploring the Path to the Moon

Long-Term Gold Targets: Exploring the Path to the Moon

To the Moon or Hell: Assessing Long-Term Gold Targets and Possible Scenarios Updated March 2023 Take a chance! All life ...
volatility trading strategies

Volatility Trading Strategies: Thriving in the Stock Market

A Scholarly Examination of Navigating Market Volatility with Volatility Trading Strategies Mar 30, 2023 Introduction: Embracing Volatility Trading Strategies The ...
Riding the Tide: Investing in Stocks as Blood Runs on the Streets

Riding the Tide: Investing in Stocks as Blood Runs on the Streets

Blood In The Streets: That's The Best Time To Buy Updated March 30, 2023 Polarisation is the new ViX for ...

Defying the Crowd: Exploring the Stock Market Fear Index

 Decoding the Stock Market Fear Index Amidst the Fed's Market Stabilization Updated March 2023  If fear starts to seep in, ...
Geopolitical news

Geopolitical news: The Energy Crises

 Europe's Energy Crunch: Navigating the Geopolitical News Dilemma Updated  Feb 2023 In Geopolitical news, Europe finds itself entangled in a ...
leading economic index

Leading Economic Index

Leading Economic Index Signals Economic Turbulence Ahead March 26, 2023 The Eurozone economy has been grappling with a slew of ...
Market Crash Best time to buy stocks

Is now the time to buy stocks: Buy if the trend is up

 Is Now the Time to Buy Stocks? An Overview of the Current Market Situation Updated March 2023 Introduction: The question ...
critical thinking

Why Is Critical Thinking Important

Why Is Critical Thinking Important?  Mar 22, 2023  The importance of critical thinking as a fundamental skill cannot be overstated, ...
Volatility of the stock market

Volatility of the stock market

Volatility of the stock market: Using it to your Advantage Mar 18,2023 The ability to find opportunity in chaos is ...
Russian economy improving; Inflation down over 50%

Russian Economy improving; Inflation down over 50%

Russian Economy On the mend Updated March 2023 We will delve into this topic from a historical standpoint for two ...
Silver to Gold ratio

Interpreting the Implications of the Silver to Gold Ratio for Investors

What Does the Silver to Gold Ratio Tell Us Updated March 2023 The ratio is rising, and it breaks past ...
Turbo-charge Your Returns: options investing for beginners

Turbo-charge Your Returns: options investing for beginners

Unlocking the Potential: Options Investing for Beginners Updated May 30, 2023 Introduction: In the quest to maximise investment returns while mitigating ...

The American Dream: Unveiling the American Nightmare

The American Dream Is Just That, Nothing But A Dream Updated March 2023 The term "American Dream" has been deeply ...
Short-Term vs Long-Term Investing Strategies

Short-Term vs Long-Term Investing Strategies

Surviving Stock Market Volatility: Short-Term Investing Strategies February 28, 2023 Investing in the stock market can be a wild ride, ...