Panic Selling: Buy The Fear & Sell The Joy

panic selling

Many subscribers (mistakenly) assumed that we were stating that the markets were ready to Drop. And they started to close their longs because they felt a crash was imminent. One thing needs to be stated clearly. We never panic, for situations that trigger panic are nothing but hidden opportunities that the masses are too blind to see. It is always prudent to bank some money when the position is showing hefty gains. Market Update Aug 29, 2021

We stated that if the above hypothesis pans out, the massive correction many experts expect might be somewhat muted. Use the subsequent pullback to start a trading journal if you are new. This provides deep insights into how emotional 90% of traders are. To defeat fear/panic, one has to understand it. You can’t control it, for if you do, it will explode one day, and the consequences will be deadly. You have to see it for what it is. A totally useless emotion whose only function is to make sure you do the wrong thing at precisely the right time. Fear is the trigger for panic selling. Panic selling is where the masses give away top-quality stocks for almost free when logic is overruled by the totally useless emotion of fear.

Not one investor in the world can prove that giving into panic paid off over the long run.
    -If they dare attempt to take this challenge, this graph will put an end to any rubbish argument they come out with.

DOW 100 years chart

This is a 100-year chart of the Dow, and as you can every single disaster proved to be a long-term buying opportunity. If one deployed all their funds during a mega-disaster type event, one would be 20X richer, if not more, within a relatively short period. This is especially true after 1990. When the Dow dipped below its main trend line, most technicians would have panicked. Still, this development proved to be an even better opportunity.

The Tactical Investor motto is simple. Panic selling is an alien term as Tactical Investor never allows fear to get a foothold in the decision-making process. There is no exception to this rule. Secondly, we view disasters through a bullish lens. We proved this in real-time several times in the past. The most notable example was the COVID crash. Thirdly we never deploy all our funds in one shot. Fourthly, we stroll out of the door; we don’t stampede. Health is the number one investment at T.I., and there is no way our subscribers or we can be healthy if we give into panic. Investing should be fun and not a stress-filled event. As one starts to understand the inner workings of the markets, one will see that watching the news or following what the expert’s state is a total waste of time. Put your valuable time to better use.

The recovery rate from crash to boom will accelerate as the money supply rises. Look at how fast the markets recouped from the COVID crash.

We are erring on the side of caution, not because we are nervous. We think that the markets might (keyword being might) provide us with an even better opportunity shortly. If this opportunity does not come to pass, we have plenty of stocks to redeploy our capital into. So, there is Plan A and B. We even have a Plan C in place, but we don’t think we will need to put it into play at this stage of the game.

Everybody panics when the word correction or crash comes to mind, but what 99% forget is that those that buy during this phase bank massive profits. The only intelligent game plan is to look at the masses and take the opposite stance. Jump in when they panic and vice versa. This is the game plan the top players have relied on since the inception of the stock market. Market Update August 21. 2021

How do you find bargains if the system is flooded with money, you cause tension, and you let that tension boil until the masses panic? Even better than creating a stampede is to make the masses think that the markets are erratic and have no rhyme or rhythm. Have you noticed that not every stock will rally when it declares breakout earnings? Conversely, companies that fail to deliver don’t always crash. This attack leads to more bargains because it is a psychological attack that triggers fear, anxiety and uncertainty, known as the terrible trio in the inner circles.

The ideal strategy would call for a mix of the above two. Start with the terrible trio and then shock the masses by creating a sharp sell-off but one that is short in duration. The already stressed minds of most investors will not be able to deal with the terrible three and a market sell-off. So, they will dump top-quality shares for next to nothing.

Remember that as more money enters the system, the volatility increases. Because the only way the top players can deploy the additional sums of money they have accumulated is to trigger a sell-off. For now, shares are not being created as fast as money is added to the system. The top players will never buy at the market; they always want a bargain. They are masters of this game.
They have conned the masses for millennia. They ensure their progeny understands the pivotal role history plays in and out of the markets. Hence their offspring hit the ground running while the masses are still learning to crawl. It is easy to play catch up, for their entire strategy utilises fear as a weapon. If the herd understood this, they would no longer have to crawl. Instead, they could also hit the ground running.

Always focus on the opportunity factor when the masses are in panic mode. That is what the top players do. When the trend is positive, panic-based events should be viewed as a Godsend. Learn to take the opposite stance and be a true contrarian when everyone panics, celebrate and vice versa. Most contrarians are nothing but fashion contrarians, AKA fake and flaky contrarians. The moment the going gets tough, they fold like paper tigers and seek safety in the caves of misery.

Some early signals indicate that the correction might occur in two phases. One during the Sept-Oct period and a stronger one, somewhere in the Jan-Feb 2022 timelines. The number of experts expecting a correction is rising, and such a development could throw them all off guard. If the signs strengthen, we will discuss this development in more detail. For now, just consider it as an extra morsel of information.

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