Is This the Time to Be Greedy or Fearful for Traders?
Jani Ziedins | Mar 22, 2023 12:57AM ET
The S&P 500 popped Tuesday, adding another 1.3% to Monday’s nice gains. As bad as the headlines seem, the best buying opportunities arrive when everyone is the most scared.
As is often the case, the latest banking scare’s selling capitulated last week when headlines were their most dire, and prices are now rebounding on less-bad-than-feared. We haven’t had another domino fall, and investors are breathing a sigh of relief.
Will this relief last? No, probably not. That’s why savvy bounce buyers are standing near the exits and proactively locking in some worthwhile profits as we challenge 4k resistance.
Remember, we only make money when we sell our winners, and this remains a choppy market. As I’ve been saying for a while, if we are not taking profits when we have them, we will take losses a few days later.
Bears that didn’t lock in quick profits last week are taking losses this week, and we will be saying the same thing about bulls that hold too long next week.
No doubt I will take profits too early, but that sure beats holding too long. Buying back in is far easier than convincing the market to return to the levels you wish you sold at.
The Fed is meeting this week, and we will have our next rate decision. If the news is good, there will be plenty of time to buy back in and ride the next big wave higher. But until then, I’m happy locking in what I’ve got.
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