If you are a trader sell, if you are an investor sit tight
From the Great IBDThe stock market autumn swoon got worse Monday after indexes undercut key levels on their charts, forcing investors to raise their defenses.
The Nasdaq composite undercut its Nov. 20 low, ending a once-promising rally. The Nasdaq closed 2.3% lower and slid further below 7000, around where support existed in late October and November. The S&P 500 lost 2.1% and tumbled below 2600, a floor that had held in the past.
With indexes falling below prior lows, IBD cut its outlook to "market in correction." This signals investors to move into cash as much as possible and as soon as possible.Reduce exposure by taking some profits. Most important, avoid buying stocks and sell any holding that falls 7% or 8% below the purchase price. Hold only the few stocks that are still outperforming and deserving of your confidence.
From my long term investments i will sell zero. Most of my holdings are in my portfolio for years and are deeply in the green.
From my trading account i am out of the market.!
Here are the five most common mistakes fund investors make, according to O'Neil:
1. Failing to sit tight.
2. Worrying about a fund's management fee, its turnover rate, or the dividend it pays.
3. Being affected by news in the market when you're supposed to be investing for the long term.
4. Selling out during bad markets.
5. Being impatient and losing confidence too soon.
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