Hi GBers! If you read my Sunday night subscribers-only update, the video above won't be a revelation. But sometimes seeing something - instead of just reading it - helps put complicated things into context.
As I write this here on Tuesday morning, the Nasdaq futures are down about 1.3% or roughly 170 points.
So my concerns expressed in the Sunday update and the Monday YouTube video about investors "getting too bullish too fast" ...are playing out as predicted unfortunately.
Watch the video for more:
So we may be in for a rough handful of days ahead as the market moves lower, induces some real fear into the majority of investors, and (my prediction) tests its 200 day moving average.
But all is not lost.
It's not the Zombie Apocalypse, mind you - just that the news headlines may be intense, with the market going down because of (fill-in-the-blank) news event.
I expect this to be the case until maybe the middle of next week. The day or two before a major holiday like Memorial Day weekend is typically bullish, or at least not-bearish.
The good news - a nice summer rally - is the silver lining to all this.
There are lots of promising tech and green energy stocks that have been knocked down 50-75% since February.
Back then I tried my best to avoid those kinds of stocks because they were far too high, given their sales and profits (presuming they had any profits).
But now I think many of them are at what I call the "washout" stage, where all the folks who bought into them as cool-sounding memes are long gone, and the stocks back at reasonable prices.
The only reason I'm not suggesting we buy them now is because it seems to me (and that's all it really is, an instinct) that the markets aren't quite done dishing out enough fear to create a subsequent summer reflex rally.
In the meantime, the portfolio's doing well.
Just be prepared for our positions to likely lose back some ground if the market weakens as I expect.
I think of them as powerful swimmers temporarily treading water against an outgoing tide. Once the tide shifts in the other direction, those swimmers will have momentum in their favor and cover a lot of ground fast.
Best of Good Buys,