I've just been reading through the posts and the charts here and catching up on all the news from the Eurozone trying to get a handle on where we are and what to do next .
It seems whichever way you look at it the best case scenario is that we get a bounce from here for a little while after which the reality of the turgid situation will in all likelihood cause a grunge down in the markets to lower levels ( how low ?? who knows ). The counterpoint to that is that sometimes when you get a bounce ,everything looks a little rosier and it can become self fulfilling for a while. Maybe that is a low percentage hope at this point but not totally impossible ,and if the powers that be launch a worldwide money printing extravaganza the game changes
I've been in markets for a long time and am caught in two minds .Firstly ,if you're holding very good stocks that are on an upward spiral you're very reluctant to let them go for any reason .In normal markets you just ride out the downturns because you know that as soon as the markets recover you'll get your reward.Conversely experience tells me that in extreme downturns you don't want to be holding anything ,the stocks that hold their own are as scarce as hens teeth if it all turns pear shaped. It's only a fool that thinks any individual stocks are immune from severe market downturns ,and we've all been there thinking that haven't we
My strategy has been to divest of anything I'm not completely attached to . Of those left there are a couple of stocks I'm just not selling because their true value will emerge at some point and they're in the bottom drawer whatever ( i.e I'm in love with them ) .The rest are dependant on stops,I haven't had too many stops hit as yet so I'm probably holding more stocks than I normally would ,hopefully the fact that they're holding up means we may get another surge.
So yeah,at this point anything risky cut loose ,tight stops on the rest .I don't care how bad it looks I think being totally out of the market is a poor strategy ,just as much as being totally loaded up is . Strangely I'm quite comfortable with where the markets are at right now having taken major positions some time ago and kept plenty of cash aside .If the markets do take a turn for the worse then extreme patience will be warranted I believe .There is some possibility that the global credit binge that we've been on for 25 years is unwinding so we'll just have to wait and see
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