Daniel Bustamante | Coach
The markets last week were a bit unruly. We're back to where we were in June on the SPY ETF but overall still up on the year.
I've always been a believer in Reflexivity Theory.
It's an interesting idea of thought and something I learned when reading a book on it when I was just a wee lad at 19. The point is, I think that panicking really just is short for "I didn't prepare." And part of being a good investor is preparing. Of course that leads into other aspects of our life but preparing for market corrections, retirement, or the "what if" situations are never a bad thing to do.
My personal investing style is combination of momentum and price action. I'll trade and invest in anything that I can see price heading higher or lower. So when markets sell off it doesn't really bother me. In fact, it has the opposite effect, I get excited. You might think I'm crazy to say that but market sell offs create opportunity for you to go short and then to get back into stocks at better price levels.
Let's take a look at Square stock as an example.
I talked about this on the new Invest Like a Shark Radio Show today.
So what we had here on this chart is Square stock taking almost 3-months to gain +35% and just 11 days to lose the same amount.
That's just insane, but these are the markets.
Most of the items I am looking at now in US equities don't really show me that "it's time to buy and hold" again. What they are saying to me is "here's a bounce, trade it, then get out."
Regardless this should be a very interesting week in the markets.
In the meantime I plan on what I doing every Sunday afternoon....find a few plays for the week then catch up on some reading.