Follow up

An important follow up on yesterday’s post, when I said “now is not the time to rush for the exits”, I’m not telling people to continue holding. If your plan calls for selling, then you need to sell. But what I was trying to convey is don’t rush into an emotional decision regarding your positions that contradicts your plan. Continue following the plan you set out for yourself.

As for a bounce, there is no grantee this next bounce will make a new high, so don’t hold out for that. And if you do sell, keep a close eye on the markets and watch how your favorite stocks hold up. Chances are the next sell-off will only last several weeks before finding support. That is the point when you want to start buying back into leading names showing the greatest potential.

And of course this recent price action doesn’t guarantee a larger sell-off. (there are no guarantees in the market) We’ve bounced many times before, so this could very well be another one of those times. If you sell, keep an eye out for strength and be ready to buy back in if the market holds up. But if this is the case, continue to stay on high alert because each successive bounce brings us closer to the one that doesn’t resume higher.