The chart attached chart shows that the US market is around a support level at current prices. The good news is likely to come out overnight so there is no compelling reason for the Dow Jones to fall to a lower support of 10,000 pts in the near-term. The question is - What factor could stun the market in that fashion? I would think that there are several things:
1. An escalation in aggression by Russia or Iran
2. A recognition of the need for higher (energy) taxes
3. A significant increase in inflation
4. Signs of a slowdown in the EU and China
These are the factors which need to be watched.
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Andrew Sheldon
www.sheldonthinks.com
Investment Strategy
If you are investing for the long term, you still need an investment strategy. Dont be fooled by the rhetoric of fund managers. The reason they advise you to 'buy & hold' is because they dont want to compete with you in sell-offs. Markets and industrial sectors are cyclical, so they demand trading to get the best returns. Fund managers actually cant hope to match the performance of small investors (if you are half good) because they have to manage huge amounts of funds and charge you a fee besides.
MY ADVICE is (i) look at a range of market indices and decide upon what level of correction would give you the justification you need to get in & out of the market. It might be a 5-10% retracement or a break of trend. (ii) Diversify if you dont have an intimate knowledge of the company or management. More than 30% in one company is aggressive.
The chart attached chart shows that the US market is around a support level at current prices. The good news is likely to come out overnight so there is no compelling reason for the Dow Jones to fall to a lower support of 10,000 pts in the near-term. The question is - What factor could stun the market in that fashion? I would think that there are several things:
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