Yesterday was no surprise to many of my readers. I have been cautioning them for the past 3 months to be prepared for this to happen.
At one point the dow was down over 400 points.
Now what to do?
I have stated before that the bear on the average goes for 4 months with a 22% decline on the first leg.
That puts the Dow at 11000 and the S&P at 1200 to 1300.
The Dow has made the greatest move therefore from a relative strength point of view it will be the last to go down the hardest.
Notice the flight to quality was to P & G yesterday because it has been a lagard for awhile compared to the big movers.
As I have stated before that the ultimate top in the market was 2000 - the dotcom frenzy.
Wehave been experiencing the rise of the bluechips but the NASDAQ hasn't even risen 50%.
The 2nd wave down is starting and where do you park your money.
High yielding resource stocks for one.
Money market for another.
SDS is a buy. This is a double down S&P short fund so this stock rises when the market goes down.
Get your money ready for the winter so when the bear goes back to sleep on a short term basis you will be ready to pick-up bargins.