Should you sell or buy the dip?
In my view the Corona Virus is a catalyst.
It is not the only issue. I do not know which issue will be dominant but I do know…
THE LAW OF THE HARVEST
There is a law, irrevocably decreed in heaven before the foundations of this world, upon which all blessings are predicated– D&C 130:20
The law of the harvest is just such a law. It states that if you plant in
the right season. If you plant in good soil, fertilize and have the right
amount of water and sunshine your odds over the long term will be good. Of course every good thing is under attack so you must do the work and fight off the weeds, pests, locusts, critters, weather issues etc.
Your odds are much worse if you plant during the harvest season. Planting when the corn is fully grown, tall with long tassels on the top is a bad
practice and your odds of success are minimal at best.
A study of The Master Cycle in stock prices can help you determine what
season we are in. Are we in the harvest season or the planting season?
A long term study of stock prices since 1936 can help you identify long
bases in stock prices an indication of the planting season and stocks that
have risen many times the price at the bottom of the base is an indication of
harvest time. When the price chart goes straight up after rising at an
increasing angle of attack this represents the tassels on the corn. Harvest
time is here.
Now these stocks have topped. What is next?
I believe that once the top occurs investors will seek to buy these great
stocks at a discount at what is perceived to be a great bargain. They may
actually make a fast profit but unless they trade promptly when the rally ends they are likely to be bag holders.
The psychology goes from temporary setback to disbelief to confusion, then
panic and after a year or more back to preparation for another planting season two or three years later. These stocks are simply examples of fully ripe stocks. They may or may not conform to cycle shown next.
The Psychological Pattern
Traders can find ample opportunities to take advantage of increased
volatility but uninformed investors who are focused on earnings forecasts and future opportunities are likely to experience serious financial pain.
You can learn more about the master pattern by reading the book, “Non
Random Profits” or by visiting the website: https://www.nonrandomprofits.com.
By understanding the master pattern and learning about average gains, mean gains and a bit of Elliot Wave analysis you can have a map that is helpful to avoid planting in the wrong season.
I have spent fifty years focused on this research and I know it is valuable
to those who do the work necessary to come to their own informed conclusion.
After the fact is not as helpful. Prepare now.
I have no current positions in the stock charts above. I am a nimble trader
and may buy issues for inter-day trading. I am risk averse at this time I am very disciplined in risk control. My clients have heavy cash positions today.
Friday Feb 27 at the close of the day about 7 minutes before the close big
buying came in so Monday could be a bounce up day. Perhaps a chance to sell at better prices will com. But do not become complacent the next big move is down in my opinion.