Last month I shared that I saw a fully overbought market and was sitting with a portfolio that had just surged higher. Despite thinking we had a great looking portfolio, my experience told me we had a pullback coming, and in this column I suggested any trading accounts should raise some cash. How quickly fear levels can rise! Over the last couple of days I have put money back to work and reduced our cash holdings from an extraordinary level of over 60% to now only 12%. Yes – I see another wave coming in – maybe even a “high tide”.
I try not to get caught up in the noise that day traders thrive on. Instead, I simply use The Magnet® Stock Selection Process to identify the best companies, and use the intermediate swings to trade around positions. I try to buy the dips and sell the rips…not be influenced by what is being said in the media on any given day.
The current conditions look ready- I am set for another wave to take us higher. The sun is coming out- let’s see if it shines on our portfolio!
Note: I use my own Magnet® Stock Selection Process to assess companies. I am not an analyst, nor do I make buy or sell recommendations. I always suggest investors do their own research.
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