The Shadow knows. Remember him? It seems a shadow has a firm grip on this stock market. Since the terrible break in mid-April we had a rally and then a decline. Trying to choose a suitable stock or mutual fund has been like grasping at shadows.
Two great Wall Street gurus, Elaine Garzarelli who manages multimillions of investors' dollars and George Soros, king of the hedge funds, each have a different take on the future.
Elaine thinks the Dow Jones Industrials will be at 12,000 to 12,500 by the end of the year. Big George says we are in a bear market and must be very careful where to invest money right now. Another pundit I saw on CNBC whose name I can't remember made a very good case for a trading range for the next several months.
Let's examine the psychology of the majority of investors at this moment in time. Almost every one of them has been beaten with a large stick and big paper profits have been taken from their wallets. They haven't really lost anything, but their enthusiasm for putting more money into the market has been greatly diminished. Most of the financial columnists and talking heads are saying this is a time for caution. The old "buy the break" conventional wisdom seems to have disappeared. How is this going to affect the entire market?
It takes more buyers than sellers to put the market up. That takes conviction and enthusiasm, both of which seem to be lacking. Until the little investor gets back his confidence it makes sense that this market has more chance of going sideways than of making any new contract highs.
There is so much bearish sentiment about what Mr. Greenspan is going to say next week that it may turn into a nonevent. In fact because of all this negative sentiment whatever he does may already be factored into the market. Even if it is a sharp interest rate increase the market may throw it off and move up much to everyone's surprise. A negative event followed by a market rise is quite bullish as we saw from the unemployment number on Friday. That 3.9% unemployment number should have made the market go down, but it went the other way. We could be in for a rally this week.
I believe that if a stock or mutual fund is not going up with a strong momentum you should not buy it. Right now almost all mutual funds are going sideways. There is plenty of time to get invested so the best thing to do is wait until a definite upward trend is established and then buy it.
Since none of the great market mavens can agree then who must you rely upon? You know. You must reply upon your own judgment. Not a broker, not a banker, not an economist, not the guy on CNBC. You. Your guess is just as good as anyone else. You.
Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.
1-888-345-7870; http://www.mutualfundmagic.com
The stock market has been in an up trend for... Read More
Minority Report the movie may not be far off if... Read More
The broker told me not to sell because the mutual... Read More
Humpty Dumpty had a great fall and all the King's... Read More
Everybody is riding the Wall Street Roller coaster. Even if... Read More
Since I can remember, and that's a long time ago,... Read More
Over the past few months, several investment professionals have brought... Read More
Forget making a profit; instead focus on the income provided... Read More
The higher the market goes the more confusing are the... Read More
04/28/2005NASDAQ dropped -12.5% year to date in 2005. S&P500 index... Read More
A 'stock option' is a contract between two parties giving... Read More
The stock market can present you with a lot of... Read More
One of the basic laws of physics is that a... Read More
If there is one term over-used when talking about making... Read More
Quick, look out the window. It's raining. No, the sun's... Read More
I was devastated!I just couldn't believe it. I was 10... Read More
Are hedge funds a suitable investment for you? Hedge funds... Read More
"Buy and hold" is one of the most heralded investment... Read More
Let's go into the details of why non-indexed mutual funds... Read More
Let's first define insanity. It is doing the same thing... Read More
(1) Stock Market is Tough Place to Make Any Money... Read More
Have you been listening to the talking heads on CNBC-TV?... Read More
What account size do I need?How much money can I... Read More
Stocks breakout from properly formed bases everyday but many investors... Read More
Where is the beef? Or maybe it should be where... Read More
elite cleaning services Buffalo Grove ...Dollar cost averaging is one of the most popular ideas... Read More
What! Me worry?Many of you remember the cover of MAD... Read More
If you are fed up with early redemption charges and... Read More
What does it take to be a stock trader? It... Read More
I would like to share with the reader an article... Read More
Look back over the years and try to remember how... Read More
Exchange Traded Funds (ETFs) are growing. Investors are choosing low... Read More
Robert Rodriguez likes to buy stocks at their lows. When... Read More
You should ignore analysts on TV, the radio, the newspaper... Read More
When purchasing mutual funds we are cautioned to read the... Read More
After some forty years of banking and investments, I retired... Read More
Mutual funds were created with the idea that one person... Read More
For the last 12 years we have seen the Japanese... Read More
The spring-loaded rat catcher is the ultimate low-tech device invented... Read More
Have you bought any mutual funds this year or late... Read More
This is a guide to the different types of mutual... Read More
Alfred Winslow Jones started hedge funds in 1949. He was... Read More
There is so much involved in developing peak performance, that... Read More
Sidney felt sick as she looked at her latest OptionsXpress... Read More
TOO OFTEN, INVESTORS SIMPLY CHOOSE TO follow the crowd. This... Read More
We are already in it, but you can't see it.... Read More
If you haven't heard of the technical indicator with the... Read More
Profitable day traders recognize that momentum trading is among the... Read More
Do you have a financial planner? Does one of your... Read More
You must take the time once a month to review... Read More
Stocks & Mutual Fund |