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Caution

February 18, 2011 – 5:55 pm

The market continues to march higher and as it does the more I think we must wait before investing new money into the market. If you are not in the market at this time take a dollar cost average approach, in other words invest slowly. If you are in the market it would be wise to sell, take some money off the table and wait for a better entry point.

Also, you do not completely avoid buying at this time. If there is something that is compelling in value and growth and the opportunity is today, buy it. It may fall with a pullback in the market but it could rise 10% or more before you have a 10% pullback so you can not be afraid to invest.

There is no reason to expect a weak market other than that it has gone up for months without a break. A correction would be a health restoring event and one that normally happens. However, the market can do anything; there are no laws of normalcy it can’t break. Try not to guess what it will do.

Good Trading
Steve Peasley

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