stock market

Patience, Patience, Patience

By TheMoneyMaven ⋅ Email This Post Email This Post ⋅ Post a comment

The market will not go down. I have been doing very short term intra-day trades and they are too quick to plan and blog about so I have not been doing so. I really like to give readers a bigger picture thought process and some trade ideas that take a while to happen. Right now we are right around the highs of the year and in an overbought state. So for me to say we are going higher could be the day before a big correction and for me to say a pullback is coming is fighting the tape.

So what do we do. We wait. There is nothing wrong with being patient. Actually, in order to be a successful investor/trader you have to have patience. I hear a lot of traders talking about Citi, Bank of America, AIG, Freddie Mac, and Fannie Mae hitting new multi-month highs and wonder if they should get in. I would not unless I have a good risk/reward setup. Normally when stocks start sky-rocketing higher I sit back and root them on even though I have no position. Why? Because what goes up must come down. And the faster a stock goes up, it normally comes down with the same speed. So yes, I have been missing out on some explosive up moves, but as soon as I see the momentum dying down, I will be looking for great risk/reward setups to the downside.

Posted on August 27, 2009
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