Surprisingly, the entire correction of that day was countered by an equivalent size of rally and then the markets continued to move upwards in excess of 5200. So what should an investor do at this stage? Some investors who missed buying into the last fall are worried that they might miss a bull market and are in a hurry to buy into the markets. Some investors are profit booking into this rally with hopes to buy again lower. I’d say that both of these strategies today are ruled out from my side. There is no bull market coming anytime soon and the same way, no bear market coming anytime soon unless Europe dies.
I don’t advice to buy into the current market nor sell into the current market. Markets are being very unpredictable today and you don’t know where the markets can go, so sellers beware and buyers beware too, any strategy can go wrong. You don’t want to buy into the markets only to see a correction and you don’t want to sell only to see markets continue to move upwards. Plus if you sell and markets correct, you might feel lucky but you really don’t know till where the correction can take markets and how sharp a rebound from lower levels be. Thus there is a possibility that you might not be able to buy into the markets completely post correction. The markets are very volatile and it will be difficult to catch and time the market at this point of time.
For buyers, I’d tell you that wait for a correction into the markets before you try to enter. The correction will and has to come one day. You will need to wait for some more time before there is a buying in the market. You can safely put money into the market after the next correction and go long with the next bull market targets. We’ve entered the stage where soon positives will weigh more than negatives and thus the next buying opportunity should probably be where you buy and forget with a long term view. I understand that there are a lot of people who are getting impatient today to buy into the markets, I suggest being more patient, the market will surely give you another opportunity : P